Palm trades at 3-year lows on bearish Oct data outlook

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KUALA LUMPUR (Nov 12): Malaysian palm oil futures fell over 1 percent at the midday break on Monday, as traders forecast bearish October data from the Malaysian Palm Oil Board (MPOB) and tracking weaker related oils on China's Dalian Commodity Exchange.

The benchmark palm oil contract for January delivery on the Bursa Malaysia Derivatives Exchange was down 1.1 percent at RM2,017 ($482.19) a tonne at the midday break, in line to chart a fifth consecutive day of losses. 

It earlier fell as much as 1.6 percent to RM2,008, its lowest levels since September 2015. 

Trading volumes stood at 24,367 lots of 25 tonnes each at noon. <1FCPO-TOT>

"Dalian is down this morning, and the market is expecting the MPOB data to be bearish," said a Kuala Lumpur-based trader. 
The MPOB released official stocks, production and export data for October at the market's midday break on Monday. 

Stockpiles grew 7.6 percent to 2.72 million tonnes, while production gained 6 percent to 1.96 million tonnes.

Meanwhile, exports fell 3 percent to 1.57 million tonnes from September. 

"Inventory levels, which are lower than expected, will help support the market for awhile, but November and December inventories are still expected to go up," said the trader.

A Reuters survey earlier forecast palm oil's end-October stockpiles to rise 14.1 percent to 2.90 million tonnes.

In other related edible oils, the Chicago December soybean oil contract was up 0.4 percent, while the January soybean oil contract on the Dalian Commodity Exchange slipped 0.4 percent. 

Meanwhile, the January palm oil contract fell 1.9 percent.

Palm oil prices are affected by movements of other edible oils as they compete for a share in the global vegetable oil market.

Palm oil is expected to test a support at RM2,036 per tonne, a break below which could cause a loss into RM1,996-RM2,016, according to Reuters market analyst for commodities and energy technicals Wang Tao.