Malaysian crude palm oil futures rose in thin volume on Friday on expectations that lower production for June would lead to a drop in stocks. At lunch, the benchmark third-month crude palm oil contract on Bursa Malaysia, September, was up 7 ringgit at 1,418 ringgit ($373.16) a tonne. It traded a 1,412 to 1,419 ringgit range in the morning session.
July, August and October contracts were also stronger at the lunch break.
"There is fear now that the June production could be much lower than what we thought, so this means the stocks could also be much lower so no one wants to go too short on their position," said a trader.
A Reuters survey released on Thursday showed Malaysian palm oil output could fall 5 percent in June from May, reversing earlier expectations of a rise.
The median forecast for closing stocks in June was 1,190,000 tonnes, down 8.1 percent from the 1,295,276 tonnes at end-May.
The government-run Malaysian Palm Oil Board releases official June production, export and stock numbers on Monday.
Two independent surveyors of Malaysian oil palm cargoes, Intertek Testing Services and Societe Generale de Surveillance, will release export estimates for July 1 to 10 on the same day.
Overall market volume was 1,083 lots of 25 tonnes each, lower than the 3,000 lots seen on an active morning.
The higher palm oil market contrasted with lower prices for Chicago soyoil, which often leads moves in Malaysian prices.
At 0430 GMT, August soyoil futures were down 0.33 cent at 24.86 cents a pound in the Chicago Board of Trade's electronic session. September futures were down 0.35 cent.
Physical prices of crude palm oil were firm.
For July, offers in the southern and central regions stood at 1,420 ringgit, while offers for August were 1,425 in both regions. Bids were at 1,417.50 for both months and regions.
The contracts were offered at 1,420 on Thursday.
Trades were reported for July only at 1,415-1,417.50 ringgit in the south.