KUALA LUMPUR, Dec 6: Malaysian palm oil futures ended higher on Friday on growers’ estimates that output in the world’s No. 2 producer had fallen steeply, and on floods that could delay harvesting.

Traders said the Malaysian Palm Oil Association (MPOA), a group of planters, forecast that the country’s palm oil output plunged nearly 11 per cent in November from a month ago – far below market expectations of a 1pc fall.

“The market was pushed higher on speculative buying especially with the news from MPOA,” said a trader with a foreign commodities brokerage.

The benchmark February contract on the Bursa Malaysia Derivatives Exchange climbed 1pc to 2,667 ringgit ($826) per tonne by Friday’s close, lifting prices to their fourth straight weekly gain with a 0.5pc rise.

Total traded volume stood at 29,566 lots of 25 tonnes, below the average 35,000 lots.

Prices earlier fell to as low as 2,630 ringgit in morning trade as investors fretted that stocks in Malaysia could have risen to their highest since March. Planters typically delay harvesting during heavy rains and thunderstorms, as fruits that have to be immediately transported to mills get stuck on flooded roads, reducing their quality.

“Nobody wants to harvest on rainy days because it’s not going to help the quality,” the Kuala Lumpur-based trader added.

“It’s better to leave the fruits on the tree than harvest it now, because the acidity levels will rise very fast when the fruit mixes with rain water.” —Reuters