December 09, 2006	Saturday	Ziqa'ad 17, 1427

KUALA LUMPUR, Dec 8: Malaysian crude palm oil futures closed higher but off their day's highs on Friday despite upbeat price outlooks from industry experts, dealers said.The benchmark February contract on the Bursa

Malaysia Derivatives exchange finished up 15 ringgit at 1,865 ringgit ($526.8) a ton, off the day's high of 1,881 ringgit.

Other months gained between one and 23 ringgit. Overall volume was 7,807 lots of 25 tons each.

Dorab Mistry, a leading palm oil analyst, told a conference on the Indonesian resort island of Bali that Malaysian crude palm oil prices were likely to be between 2,200-2,400 ringgit a ton between January and March next year.

I expect CPO prices to hover between 2,200-2,400 ringgit a ton in order to ensure workable levels of stocks.

The recent drought in Indonesia and anaemic rainfall in parts of Malaysia are likely to affect production next year, he said.

Earlier, Sabri Ahmad, chief of the Malaysian Palm Oil Association, told the meeting that Malaysian palm oil prices were seen between 1,800 and 2,000 ringgit per ton in the near term. Prices have an upside potential to reach 2,200 ringgit per ton in the first half of 2007, he added.

Leading palm oil analyst James Fry said Malaysian crude palm oil prices were likely to exceed 2,000 ringgit ($562.8) per ton in early 2007 as stock levels fall.

At the Chicago Board of Trade, soyabean futures rose on Thursday, recovering some losses after this week's slide when firms liquidated long positions, traders said.

The weakest of the complex was soyaoil, pressed by prospects for more competition from Canadian canola and the US Census Bureau bigger October stocks figure issued on Thursday.

December soyaoil ended 0.02 cent lower at 28.34 cents and January was down 0.05 cent at 28.73 cents. The back months closed firm but range-bound, up 0.02 to 0.13 cent.

The December contract was up 0.04 cents, at 28.38 cents per lb, in Asian trading hours.

Soyaoil and palm oil compete for exports and their prices often move in step.

In the physical palm oil market, December shipment was quoted at 1,860/1,865 ringgit per ton in the southern region and 1,855/1,860 ringgit per ton in the central region, with trades between 1,850 and 1,860 ringgit and 1,845 ringgit and 1,855 ringgit in the two areas respectively.

Exports of Malaysian palm products for November fell 5 per cent to 1,359,790 tons from 1,430,900 tons in October, cargo surveyor Societe Generale de Surveillance said.

Another cargo surveyor, Intertek Testing Services, said exports during the month fell 5.7 per cent to 1,366,111 tons.

On Thursday, Malaysian palm-oil and property firm IOI Corp Bhd said it had agreed to buy two unlisted downstream palm-oil firms for $120 million, in a deal that would make it the world's largest vegetable oil-based fatty acid producer.—Reuters