04/04/2012 (Business Recorder) -  Malaysian palm oil futures extended gains on Tuesday, touching their highest in more than a year as traders bet on greater demand for palm oil after a key US planting report pointed to a smaller soybean crop, while recovering exports also boosted sentiment.

The US Department of Agriculture said farmers would plant 2 percent less of the soybean crop than expected, reinforcing the view that global supply for oilseeds is tightening, lifting palm oil futures to gain close to 12 percent this year.

"At least for the first half of 2012, there's a continuation of supportive news for oilseeds as a whole. The positive sentiment for palm oil will likely stay for the coming week," said Ker Chung Yang, an analyst at Phillip Futures in Singapore.

"Another supporting factor is that the exports for March were very positive. At least we see the export numbers picking up again," he added.

By the midday break, benchmark June palm oil futures on the Bursa Malaysia Derivatives Exchange edged up 0.5 percent at 3,550 ringgit ($1,166) per tonne. Prices rose as high as 3,566 ringgit, a level unseen since March 9 last year.

Traded volumes stood at around 7,398 lots of 25 tonnes each, slightly lower than the usual 12,500 lots.

Malaysian palm oil will gain further to 3,590 ringgit as it has cleared a resistance at 3,528 ringgit, Reuters market analyst Wang Tao said, based on technical analysis.

Export demand for palm oil has been picking up in No.2 producer Malaysia after four straight months of declines. March palm oil exports rose 4.8 percent, according to cargo surveyor Intertek Testing Services.

Another cargo surveyor, Societe Generale de Surveillance, reported a jump of 3.5 percent for the same period.

Brent crude was steady above $125 a barrel on Tuesday after sharp gains in the previous session, supported by fresh signs of a sustained recovery in top oil consumer the United States and the prospect of tighter crude supplies from the North Sea.

In other vegetable oil markets, the most active US soyoil contract for May edged down 0.1 percent while the most active September 2012 soyoil contract on China's Dalian Commodity exchange extended its losing streak and was trading down 1.0 percent.