KUALA LUMPUR (Jan 12): Malaysian palm oil futures fell on Tuesday as global crude oil prices tumbled to 12-year lows this week, with declining production data from a government body doing little do boost market sentiment.

The palm oil contract for March on the Bursa Malaysia Derivatives Exchange lost 0.4 percent to 2,388 ringgit  ($542.73) per tonne at the midday break, recovering slightly from a new three-week low of 2,375 ringgit reached earlier.

"The market still looks weak on the back of crude oil trading at new lows, and on uncertain Asian equity markets," said a trader from Kuala Lumpur.

"Any rebound in the afternoon session is due to a retracement on an oversold market."

Traded volume stood at 18,592 lots of 25 tonnes each.
 
Global crude oil prices have fallen by about 20 percent since the start of the year as analysts scrambled to cut their 2016 oil price forecasts and traders bet on further price falls.
 
U.S. crude West Texas Intermediate (WTI) was trading around $30.77 per barrel while Brent crude futures was at $30.92 at 0455 GMT.

Data from the Malaysian Palm Oil Board on Monday showed a 1.1 percent fall in December exports compared with a Reuters poll forecast of a 6.6 percent fall.

Inventories and production also fell in December, dropping by 9.5 percent and 15.4 percent, respectively.
 
Palm oil may slide a bit more to 2,367 ringgit per tonne, as it has broken support at 2,394 ringgit, according to Reuters market analyst for commodities Wang Tao.

The U.S. March soyoil contract lost 0.1 percent, while the May soybean oil contract on the Dalian Commodity Exchange was down 0.9 percent.