Trader's Comment: Palm oil futures edged higher due to India’s move to impose tax on crude soybean oil.

Palm oil futures edged higher due to India’s move to impose tax on crude soybean oil. Benchmark Feb09 opened RM4 higher at 1440 when traders began to speculate on the news that India government imposed 20% duty on rival soy oil, while imposing no duties at all on palm oil. This move could stimulate more demand on palm oil and may help to reduce the record high level of stocks. CPO prices merely hit the day low at 1438 after opened and there after continue to rally until afternoon session. News released by Hamburg-based oilseeds analysts Oil World, which forecasted that Malaysia’s 2009 palm oil production will only increased marginally, also help lifted some bullish sentiment in the market. Benchmark Feb09 hit the day high of 1493 before it encountered some profit taking activities in the later part of 2nd session. This saw CPO price eased off to hit 1461. Nevertheless, it managed to bounce back again to settle RM44 higher at 1480.