Malaysian crude palm oil futures closed slightly higher on Wednesday after shuttling in a wide range as a rally in rival Chicago soyaoil was offset by worries over falling exports.
Traders said market volatility was likely to continue as players debated its likely future direction.
Some felt the market has been oversold while others saw more downside as exports slowed.
"People are worried that with production picking up and exports falling, stocks will build up again," said a trader. "The market will track closely export performance for this month".
The market's main cargo surveyor, Societe Generale de Surveillance (SGS), on Monday estimated Malaysia's palm oil exports for May at 953,781 tonnes, down nine percent from April.
Crop analyst Ivan Wong had forecast Malaysian palm oil output in May at 1.090-1.095 million tonnes, up from 1.01 million tonnes in April. Wong is due to release fresh crop estimates on Monday.
Benchmark third-month palm oil futures contract on the Malaysia Derivatives Exchange, August, ended up eight ringgit at 1,643 ringgit ($432.37) a tonne after trading between 1,606 and 1,662.
The contract had opened 15 ringgit higher after Chicago Board of Trade soyaoil futures ended up 0.60 cent to 1.50 cents per lb on Tuesday. Palm oil and soyaoil compete for the same export markets and their prices often move in step.
Other traded contracts settled up five to six ringgit. Overall volume stood at 7,191 lots, down from Tuesday's 8,226 lots.
Physical crude palm oil ended little changed after surrendering their morning gains.
June saw buyers/sellers at 1,660/1,1665 ringgit a tonne in the southern and central regions, compared with Tuesday's close of 1,660/1,670.
Trades were reported at between 1,650 and 1,670 ringgit in both regions.
July was quoted at 1,650/1,660 ringgit. Trade was reported at 1,650 ringgit in the south.
PALM OIL FUTURES:
June (south): 1665.
Open/High/Low: 1650/1662/1606.
Previous close: 1670.
PALM OIL PHYSICALS:
August (3rd month): 1643.
Previous settlement: 1635.
FUTURES: Benchmark third-month August up eight ringgit at 1,643 ringgit ($432.37) a tonne.
PHYSICALS: Little changed.