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VEGOILS-Palm prices hit new 1-year high, further gains expected

* Prices hit a high of 2,632 ringgit - highest since Sept. 28, 2012

* Palm posts biggest weekly gain since December 2010

* Lower production expectations boost prices - trader

(Recasts, updates closing prices, adds details)

By Michael Taylor

JAKARTA, Nov 1 (Reuters) - Malaysian palm oil futures hit a fresh one-year

high on Friday, as strong Asian demand coupled with lower production

expectations supported prices for a fifth consecutive session.

Both Malaysia and Indonesia, which account for the lion's share of global

palm oil production, are entering their monsoon weather season, traders and

analysts say, with output also likely to be dented by a lower production cycle

as yields have eased from last year.

The benchmark January contract on the Bursa Malaysia Derivatives

Exchange ended 1.2 percent higher at 2,623 ringgit ($830) per tonne.

Earlier, benchmark prices rose to 2,632 ringgit, their highest since Sept.

28, 2012. It was also their biggest weekly gain since December 2010 and have

risen about 8 percent so far this year.

"The market is holding very well," said a trader with a foreign commodities

brokerage in Kuala Lumpur. "We are not going to have high production, due to wet

weather conditions.

"The market still looks friendly so there is room to go higher," he said,

adding that both Chinese and Indian demand remained strong.

Total traded volume stood at 40,821 lots of 25 tonnes each, above the usual

35,000 lots.

"Demand should remain fairly stable in view of the upcoming festive events

like Chinese New Year and rising biodiesel mandates in Indonesia," CIMB Analyst

Ivy Ng said in a note.

"The improvement in CPO (crude palm oil) price could be sustained into early


Also supporting palm prices, said one analyst, was a new regulation in

Indonesia, which caps palm plantation areas at 100,000 hectares.

In other markets, Brent futures traded around $109 a barrel, recovering from

an overnight fall after an official survey showed manufacturing in China, the

world's second-biggest oil consumer, expanded in October at its fastest pace in

18 months.

In competing vegetable oil markets, the U.S. soyoil contract for December

rose 0.9 percent in early Asian trade. The most-active May soybean oil

contract on the Dalian Commodities Exchange gained by 1.2 percent.

Palm, soy and crude oil prices at 1012 GMT

Contract Month Last Change Low High Volume

MY PALM OIL NOV3 2648 +26.00 2611 2648 83

MY PALM OIL DEC3 2633 +33.00 2585 2635 1891

MY PALM OIL JAN4 2623 +30.00 2576 2632 23340

CHINA PALM OLEIN MAY4 6374 +74.00 6284 6374 864288

CHINA SOYOIL MAY4 7302 +90.00 7200 7308 1212654

CBOT SOY OIL DEC3 41.72 +0.39 41.35 42.00 7645

NYMEX CRUDE DEC3 96.40 +0.02 96.23 96.65 9413

Palm oil prices in Malaysian ringgit per tonne

CBOT soy oil in U.S. cents per pound

Dalian soy oil and RBD palm olein in Chinese yuan per tonne

Crude in U.S. dollars per barrel

($1 = 3.1555 Malaysian ringgits)

(Editing by Prateek Chatterjee)