06/07/2010 (Bloomberg) - Palm oil gained for the first time in four days after crude oil reversed losses, increasing the appeal of the tropical commodity for use in bio-diesel.

The September-delivery contract rose 0.5 percent to 2,301 ringgit ($718) a metric ton on the Malaysia Derivatives Exchange. The price declined 0.6 percent to the lowest level since Nov. 13 in intraday trading.

Crude climbed for the first time in six days as the dollar weakened and a gain in equities reaffirmed confidence the global recovery will stoke fuel demand. August-delivery futures gained as much as 1.3 percent to $73.1 a barrel in electronic trading on the New York Mercantile Exchange.

“Palm and crude oil had both fallen substantially and a bounce back was due,” said Amol Tilak, an analyst at Kotak Commodity Services in Mumbai. “Palm oil will consolidate at current levels as demand is expected to be good.”

The market will take its cues from data on output, exports and stockpiles to be released by the Malaysian Palm Oil Board, usually on the 10th of each month or the next working day.

June palm oil exports from Malaysia climbed 1.5 percent to 1.35 million tons, Intertek said on June 30. Shipments to China jumped 22 percent to 400,200 tons from May, the surveyor said. Rival firm Societe Generale de Surveillance estimated overseas sales rose 1.2 percent last month to 1.34 million tons, with shipments to China climbed 4.5 percent to 354,700 tons.

China is the largest consumer of edible oils.

Soybean futures for November delivery gained as much as 0.5 percent to below $9.10 a bushel on the Chicago Board of Trade, paring losses of as much as 0.7 percent earlier. Palm and soybean oils are direct substitutes.

“We expect a downside bias in the coming months” for the oilseed, Rabobank Agri Commodity Markets Research said in its monthly report yesterday.

CME Group Inc.’s September-delivery palm oil contract, pegged to the Malaysian benchmark price, lost 0.4 percent to $720 a ton.