Palm at more than one-week low on expected output rise

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KUALA LUMPUR (July 24): Malaysian palm oil futures fell to their lowest in more than a week on Tuesday evening, charting a second consecutive session of losses, on expectations that production will rise in the coming weeks.

The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange was down 0.8% at 2,152 ringgit (US$529.66) a tonne at the close of trade. It earlier fell to 2,148 ringgit, its lowest since July 13. 

Trading volume stood at 53,348 lots of 25 tonnes each at the end of the trading day. 

"The market is down on concerns that production will rise," said a futures trader in Singapore, adding that the immediate focus is on export data scheduled for release on Wednesday. 

A rise in palm oil output, which seasonally begins in the third quarter of the year, typically adds to inventory levels and weighs on prices.

Increasing exports could help to reduce stockpiles. Malaysian shipment data from cargo surveyors for the July 1-25 period is scheduled for release after 0300 GMT on Wednesday. 

Weakness in related edible oils is also dampening sentiment for palm, another futures trader said. Palm oil prices are usually affected by the performance of other edible oils that compete for a share of the global vegetable oils market.

In other related oils, the Chicago December soybean oil contract was last up 0.1%.

Palm oil could break a support at 2,149 ringgit a tonne and fall to the next support at 2,123 ringgit, said Wang Tao, Reuters market analyst for commodities and energy technicals.
                
 Palm, soy and crude oil prices at 1219 GMT

 Contract          Month    Last   Change     Low   High  Volume
 MY PALM OIL       AUG8     2095   -35.00    2095   2126     368
 MY PALM OIL       SEP8     2143   -20.00    2140   2165    6532
 MY PALM OIL       OCT8     2152   -17.00    2148   2173   19207
 CHINA PALM OLEIN  SEP8        0    +0.00       0      0       0
 CHINA SOYOIL      SEP8        0    +0.00       0      0       0
 CBOT SOY OIL      DEC8    28.34    +0.01   28.22  28.37    4565
 INDIA PALM OIL    JUL8   614.40    -3.40  613.60  616.4     465
 INDIA SOYOIL      AUG8   742.35    -4.10   739.4  745.3   30180
 NYMEX CRUDE       SEP8    68.42    +0.53   67.56  68.45  127562

 Palm oil prices in Malaysian ringgit per tonne
 CBOT soy oil in U.S. cents per pound
 Dalian soy oil and RBD palm olein in Chinese yuan per tonne
 India soy oil in Indian rupee per 10 kg
 Crude in U.S. dollars per barrel
 
(US$1 = 4.0630 ringgit)
(US$1 = 68.9250 Indian rupees)
(US$1 = 6.8088 Chinese yuan)