MUMBAI, Sept 27: Malaysian crude palm oil futures, down by a quarter this year, may dip 10 per cent by December as the retreat of funds from the market and economic gloom hits demand while supply remains strong, industry analyst Dorab Mistry said.

Demand for palm oil has not been able to recover after it was crimped by high prices last year, while supplies soared after excellent weather conditions this year, Mistry told Reuters in an interview on the sidelines of the Globoil conference.

Mistry, a director of India’s commodities-to-appliances company Godrej International Ltd, is scheduled to present a paper on price forecasting on Sunday.

Now of course the economic outlook for the whole world has become very cloudy, so we may not capture back the demand we have lost, he said.

On Friday, the most-active December contract on the Bursa Malaysia Derivatives Exchange closed up 33 ringgit at 2,313 ringgit ($674) per ton. Prices have halved since their record level in March.

Price have already fallen a great deal but we may not have bottomed out yet.---Reuters