Crude palm oil (CPO) futures on Bursa Derivatives Exchange extended its uptrend to close at the highest level in over one month on improved market sentiments and better export outlook.

The three-month benchmark CPO contract for January had touched a high of RM3,007 per tonne in late trade before settling slightly lower at RM2,980 per tonne, but still higher by RM29 from Tuesday’s close at RM2,951 per tonne.

A trader told StarBiz that positive report on the eurozone debt deal by its leaders with private banks and insurers, as well as higher crude oil and soybean oil prices, were supporting the current CPO prices.

Demand for CPO is also looking good given independent cargo surveyor Intertek, which reported that Malaysia’s palm oil exports had increased 16.4% to 1.4 million tonnes in the first 25 days of October, compared with the same period in September.

The trader also said there was still strong concern over the high CPO production in the past few months. Palm oil stocks in September rose to 2.12 million tonnes, a new high in 2011 after hitting 2.05 million tonnes in June.

“Many are expecting for the peak CPO production season to come to an end soon with the coming of the monsoon season. This hopefully will be reflected in the Malaysian Palm Oil Board statistics for October to be released next month,” he added.

Meanwhile, OilWorld expects global oilseed prices including palm oil to rise in early 2012 as demand would continue on increasing world populations and expanded biofuel output.

“The growth in world palm oil production is set to slow as trees need rest after their good performance in 2011, raising the dependence on seed oils,” it said.

“This will enforce higher crushings which would require a further drawdown of soybean stocks,” it added.

Global soybean supplies were currently sufficient to cover demand, but only by reducing stocks, which in turn will raise world dependence on South American harvests in early 2012, it said.

The European Union, United States, Argentina and Brazil seek more edible oils for biofuel output while China and India need more to feed their growing populations, it said.

“World demand for vegetable oil is going to accelerate in October-September period,” it said, adding: “This would necessitate a reduction of stocks and a tightening of the global vegetable oil balance in January-September 2012 period.”–The Star