Malaysian palm oil closes at new low

Malaysian palm oil closes at new low

KUALA LUMPUR (Reuters): Malaysian palm oil futures closed at
their lowest in over 13 months as players liquidated positions
due to worries about sales following Indonesia's decision to cut
export taxes.

Traders said concern over growing domestic stocks and weaker
Chicago soyoil futures overnight also weighed on prices.

The benchmark third-month November futures contract ended down
18 ringgit at 972 ringgit ($255.79) a ton, its weakest level
since July 30, 1999.

Volume increased to 1,759 lots against 845 on Tuesday.

"Sentiment is very weak and players simply liquidate their
positions. The market could go lower," said one trader.

Traders pegged immediate support at 950 ringgit.

Indonesian Finance Minister Prijadi Praptosuhardjo on Tuesday
signed a decree cutting export tax on crude palm oil to five
percent from 10 percent, effective immediately.

The decree also cut export taxes on crude olein to two percent
from eight percent and refined bleached deodorized palm olein to
two percent from six percent. It also reduced the export tax on
RBD palm oil to two percent from six percent.

Malaysian traders said the tax cuts would encourage more
exports from Indonesia, the world's second largest producer after
Malaysia, and spark stiffer competition between the two countries
in the international market.

Prices also eased ahead of this week's exports, output and
stocks data, traders said.

The official Malaysian Palm Oil Board will issue its August
figures on Friday.

Cargo surveyors Societe Generale de Surveillance Malaysia Sdn
Bhd and Intertech Testing Services will also release on Friday
exports data for September 1-15. On Thursday, private forecaster
Ivan Wong will issue his final estimates of August exports,
stocks and output.

Physical prices also fell due to a lack of demand for refined
products coupled with ample supplies.

Sept (south) crude palm oil was offered at 940 ringgit a ton
against bids of 935. It traded from 950 to 940.

Sept (central) was offered at 935 ringgit against bids of 930,
and trades were reported at 945 to 930.

Among refined products, Sept RBD palm oil was offered at $260
a ton FOB, Oct at $262.50 and Nov/Dec at $265.

There were offers for Sept and Oct RBD palm olein at $282.50,
and Nov/Dec at $287.50.

Sept/Oct RBD palm stearin was offered at $202.50 and Sept/Oct
palm fatty acid distillate was offered at $170.