VEGOILS-Palm oil hits two-month high on tight supplies

* Market hits intraday top of 2,551 rgt/T, strongest levels

since June 13

* Palm sees upsides on tight supplies - trader

(Updates latest prices)

By Emily Chow

KUALA LUMPUR, Aug 12 (Reuters) - Malaysian palm oil futures

hit a two-month high on Friday, achieving a fourth session of

gains in five, due to tight physical supplies of the tropical

oil.

Benchmark palm oil futures for October on the

Bursa Malaysia Derivatives Exchange rose 1.7 percent to 2,525

ringgit ($627) per tonne in the evening. The price earlier rose

to an intraday high of 2,551 ringgit, its highest levels since

June 13.

Palm reached a weekly gain of 4.9 percent, its strongest

weekly climb since February.

Traded volumes stood at 73,297 lots of 25 tonnes each at the

closing trade, higher than last year's average of 44,600.

"The market is fulfilling the upside trend. Supplies are

tight as production isn't coming in," explained a Kuala

Lumpur-based trader, attributing the short supplies to lower

output due to the El Nino's dry weather effects.

The weather phenomenon, which occurred last year, typically

brings scorching heat across Southeast Asia, impacting palm oil

yields in the world's largest producers of the tropical oil --

Malaysia and Indonesia -- this year.

July-end production in Malaysia, the world's second-largest

palm oil producer, showed a 3.5 percent month-on-month to 1.59

million tonnes, according to government data from the Malaysian

Palm Oil Board (MPOB).

Output however was at its weakest July levels in six years

due to the effects on fruit yields of El Nino.

In related vegetable oils, the Chicago Board of Trade

soybean oil December contract gained 0.6 percent.

Palm, soy and crude oil prices at 1034 GMT

Contract Month Last Change Low High Volume

MY PALM OIL AUG6 2620 +8.00 2610 2660 21

MY PALM OIL SEP6 2620 +68.00 2544 2642 3046

MY PALM OIL OCT6 2523 +41.00 2475 2551 33508

CHINA PALM OLEIN JAN7 5336 +48.00 5230 5346 894656

CHINA SOYOIL JAN7 6204 +0.00 6140 6214 504490

CBOT SOY OIL DEC6 32.41 +0.00 32.04 32.67 11373

INDIA PALM OIL AUG6 545.00 +6.20 531.10 549.8 2710

INDIA SOYOIL AUG6 636.6 +3.10 635 638 3500

NYMEX CRUDE SEP6 43.53 +0.04 43.37 44.17 102468

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

India soy oil in Indian rupee per 10 kg

Crude in U.S. dollars per barrel

($1 = 4.0260 ringgit)

($1 = 66.8650 Indian rupees)

($1 = 6.6453 Chinese yuan)

(Reporting by Emily Chow; Editing by Sherry

Jacob-Phillips/Keith Weir)