KUALA LUMPUR, April 16: Malaysian palm oil futures fell on Wednesday, slipping from a three-week high hit the previous day on profit-taking but strong demand from India limited losses.

The outlook for palm oil, which has gained 20 per cent this year, looks brighter as India posted a larger than expected increase in imports in March while China resumed buying to build up its reserves, traders and analysts said.

The benchmark July contract on Bursa Malaysia Derivatives Exchange settled 16 ringgit lower at 3,674 ringgit ($1,166) per ton. On Tuesday, the benchmark stood at 3,690 ringgit, a level unseen since March 26.

The market was slightly overdone yesterday and profit-taking set in but it’s bound to get higher since major edible oil consuming countries seem to be getting ready for a buying spree, said a trader with a local brokerage.

Other traded months ranged between a 4 ringgit rise to declines of 33 ringgit per ton in overall trade of 11,565 lots of 25 tons each.

Imports from China have started for some time now and have been expected to be 30 per cent higher this year, said Sarina Lesmina, an Indonesia-based analyst with Macquarie Research.

It’s a good time for consumers to buy palm oil now before it moves much higher on the back of rising soyaoil prices. Malaysian palm oil exports in the first half of April stood at 579,397 tons, down 12.8 per cent from a month ago, but sharply higher than a decline of 41 per cent between April 1 and 10, cargo surveyor Intertek Testing Services said.

In Malaysia’s physical market, crude palm oil for April shipment in the southern region was quoted at 3,650/3,670 ringgit a ton. Trades were done between 3,650 and 3,660 ringgit.—Reuters