Malaysian palm oil falls

Malaysian palm oil futures fell on Thursday after hitting a one-month high earlier in the session as weak economic Chinese data erased gains made on higher export hopes. Commodity markets come under pressure after weak economic data from the world's top commodities buyer China signalled some weaker demand in the months to come.
The HSBC flash PMI, the earliest available indicator of industrial activity in China fell to 48.9 in July, its lowest since March 2009, as monetary policy tightening and slack global demand weighed on the economy. "Weaker global market sentiment has finally weighed on palm oil. Some of the fundamentals are improving in terms of export demand but it may still not be enough given the high stocks," said a trader with a foreign commodities brokerage.
The benchmark October crude palm oil contract on Bursa Malaysia Derivatives touched one-month highs of 3,164 ringgit before paring some gains to end 23 ringgit lower at 3,130 ringgit ($1,044.186). Overall traded volume stood at 22,636 lots of 25 tonnes each, below the usual 25,000 lots.
Higher demand comes as supply in top producers Indonesia and Malaysia are expected to rise on the back of better yields and larger oil palm growing areas coming into maturity. Indonesia's crude palm oil output this year is estimated at 22.5 million tonnes to 23 million tonnes, up from 21.6 million tonnes in 2010, executive director of the Indonesian Palm Oil Producers Association (GAPKI) said on Thursday.
Brent oil fell below $118 on Thursday after weak economic data from the world's No.2 oil user China outweighed flimsy support from market expectation the sovereign debt crisis on both sides of the Atlantic could somehow be contained.
Other vegetable oils were lacklustre in late Asian hours. US soyoil for August delivery was almost flat during late Asian trade hours as some profit-taking erased gains made from strong China demand for soybeans and hot weather affecting grain crops in the US Midwest.
US Agriculture Department on Wednesday said private exporters reported the sale of 220,000 tonnes of US soybeans to China for delivery during the 2011/12 marketing year. In China, the most active May 2012 soyoil on Dalian Commodity Exchange barely moved.