Malaysian crude palm oil futures fell on Wednesday as rising production figures by an official crop agency sparked worries of a supply build-up and rival soyaoil weakened in Asian trade, dealers said.
Palm oil has fallen further from record highs of 3,458 ringgit hit last week on volatile crude and vegetable oil markets but has been supported by Jakarta's plants to hike export taxes, traders said.
The benchmark April contract on the Bursa Malaysia Derivatives Exchange settled down 15 ringgit at 3,360 ringgit ($1,038) a tonne, after going as low as 3,338 ringgit. "It is a recipe for a decline with speculative spillover from soyaoil and fundamentals of a supply build-up while exports don't look that fantastic," said a trader with a foreign brokerage.
Other traded months fell between 14 and 40 ringgit. Overall trade fell to 7,842 lots of 25 tonnes from the usual 10,000 lots. Malaysia's crude palm oil output rose 2 percent to 1,424,247 tonnes in January, from a revised 1,396,134 tonnes a month, official crop agency Malaysian.
Palm Oil Board said on Wednesday. A Reuters poll showed last month that Malaysia's January palm oil output would fall 5.5 percent to 1.32 million tonnes due to lower yields, after floods swamped key producing areas in central and south Malaysia late last year.
Exports of Malaysian palm oil products for February 1-10 have struggled in the face of red-hot with cargo surveyors Intertek Testing Services and Societe Generale de Surveillance reporting only marginal increases. Chicago's benchmark March soyaoil was trading lower during Asian hours, swinging from a higher close on Tuesday.
In the physical market, crude palm oil for February shipment in the southern region was quoted at 3,370/3,380 ringgit a tonne. Trades were done between 3,380 and 3,390 ringgit. Palm soya and crude oil prices.
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