Palm oil's premium over gasoil highest in 10 months

Kuala Lumpur

THE El Nino-induced dry weather that's parching fields across South-east Asia has pushed palm oil's premium over gasoil to the highest in 10 months, threatening to curb use of the commodity in biofuel production.

Palm oil in Kuala Lumpur cost about US$160 a tonne more than gasoil on ICE Futures Europe on Dec 3, the most expensive since January and more than double the average of US$60 over the past year, data compiled by Bloomberg shows. Palm oil surged 27 per cent from a six-year low in August on concern El Nino would reduce output in the top producers and as Indonesia promoted more use for biodiesel.