June 18, 2008	Wednesday	Jamadi-us-Sani 13, 1429

JAKARTA, June 17: Malaysian crude palm oil futures fell 2.2 per cent on Tuesday as losses in the US crude oil market encouraged investors to sell vegetable oils and as sluggish overseas demand weighed on the market.

Palm oil, used in products from soaps to biofuel, along with soyaoil markets from United States to China, have benefited from rising oil prices, gaining about 19.5 per cent so far this year.

But sliding exports and rising stock at home, pulled the market nearly 19 per cent off an historic high of 4,486 ringgit per ton hit in early March.

The benchmark September contract on the Bursa Malaysia Derivatives Exchange ended down 82 ringgit or 2.2 per cent to 3,645 ringgit per ton after going as low as 3,639 ringgit.

Today is the selling day for the market. It’s more of a long liquidation and technical selling on the back of weak soyaoil and crude oil, said a trader with a foreign brokerage.

Sentiment on supply-demand is not bullish. We get our support now from external factors, crude oil and soyaoil. Other traded months fell between 53 and 90 ringgit.

Overall trade stood at 13,415 lots of 25 tons.

Exports of Malaysian palm oil products for June 1-15 fell 13 per cent to 558,630 tons from 642,538 tons shipped between May 1 and 15, cargo surveyor Intertek Testing Services said on Monday.

Another cargo surveyor Societe Generale de Surveillance said exports in the same period fell 9 per cent to 600,674 tons.

Stocks of palm oil in Malaysia rose 6.9 per cent to 1,913,360 tons in May due to production outpacing overseas demand, official crop agency Malaysian Palm Oil Board said last week.

July crude settled down 25 cents at $134.61 a barrel on Monday. But crude fell $1.54 to $133.07 on Tuesday.

In Malaysia’s cash market, crude palm oil for June shipment in the southern region was quoted at 3,660/3,670 ringgit a ton. Trades were done at 3,650-3,680 ringgit a ton.—Reuters