Palm oil prices likely to advance

Palm oil, little changed, may advance after a recent slump in prices widened the discount to soybean oil making it a cheaper option and as yesterday's jump in crude oil lifted the appeal of vegetable oils as biofuel feedstock. The September-delivery contract climbed as much as 0.4 per cent to 3,051 ringgit ($1,015) per metric tonne on the Malaysia Derivatives Exchange and traded at 3,043 ringgit. Futures earlier touched the lowest level in more than eight months and have declined 20 per cent this year. "Oil moving up may be making it more attractive from the biofuel side of things," Ivy Ng, an analyst at CIMB Investment Bank Bhd., said. Crude for August delivery lost 0.4 per cent after gaining as much as 0.9 per cent. The contract jumped 2 per cent yesterday.