Malaysia palm oil futures fell on Monday, weighed by stocks that hit an 18-month high last month and lacklustre exports. But losses were limited thanks to firmer competing soyoil markets that gained on concerns that hotter weather in US Midwest may affect the soy crop.
"The growing stocks triggered some profit-taking. There may be further declines in the days to come although weather developments in the US could change that," said a trader with a foreign commodities brokerage in Kuala Lumpur. The benchmark September crude palm oil contract on Bursa Malaysia Derivatives fell 0.1 percent to 3,074 Malaysian ringgit ($1,027) a tonne, reversing gains made earlier in the day. Overall traded volume was a tad lower at 18,760 lots of 25 tonnes each, compared to the usual 25,000 lots.
There could now be more selling pressure after Malaysian Palm Oil Board data showed Malaysia's June palm oil stocks climbed to an 18-month high of 2.05 million tonnes. July's export trend also looks weak with cargo surveyor Intertek Testing Services reporting a 1.3 percent rise in Malaysian exports for the first ten days of this month from the same period in May. Another surveyor, Societe Generale de Surveillance said exports dropped 3.3 percent in the same period.
Other vegetable oils were firm in Asian trade hours. US soyoil for July delivery rose 0.3 percent and the most traded May 2012 contract up 0.1 percent on Monday. Traders are awaiting the United States Department of Agriculture's (USDA) monthly supply-demand report on Tuesday, which will update its estimate of ending stocks and offer its first forecast of spring wheat production this year.
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