KUALA LUMPUR, Oct 21: Malaysian crude palm oil futures ended 1.5 per cent lower on Tuesday after a leading industry analyst gave a bearish forecast amid losses in global vegetable oil markets.

The market was also pressured when Malaysia, the world’s second-largest producer of palm oil, pushed back a key cabinet meeting on boosting palm oil prices to next week from Tuesday because several ministers were unable to attend.

The benchmark January palm contract on Bursa Malaysia’s Derivatives Exchange settled down 25 ringgit at 1,652 ringgit ($486) per ton after going as low as 1,639 ringgit.

A slowdown in Malaysian crude palm oil output was set to accelerate although it would not come fast enough to lift prices, which could fall by another 30 per cent, analyst James Fry said on Tuesday.

Past CPO (crude palm oil) price cycles have reverted promptly to their long-term trends, once the correction gets under way, Fry, head of London-based LMC International, told a conference in Kuala Lumpur.

If repeated this time, this means that CPO prices should soon fall to 1,200 to 1,300 ringgit (per ton). S. Paramalingam, executive director of local broker Pelindung Bestari, said: James Fry has fried the market with his prices forecasts.

The market was trying to build up on Opec and the Malaysian government’s move to help the industry and nothing came out of that as yet. Other traded months on exchange fell between 21 and 49 ringgit. Overall volume was 11,435 lots of 25 tons each.

Oil eased on Tuesday as expectations that a global recession will crush demand for oil offset thoughts that Opec would offer support by cutting output this week.

US soyaoil for December delivery slid 2.6 per cent while the most active Jan. 2009 soyabean oil contract on the Dalian Commodity Exchange fell 3.7 per cent.

Palm oil prices in Indonesia extended gains on Tuesday as Malaysian market edged higher in morning trade.

The state marketing centre, which sells palm oil from state plantations, said it sold palm oil at 4,388 rupiah ($0.446) rupiah a kg, up from 4,378 rupiah a kg on Monday.—Reuters