VEGOILS-Palm oil falls for 2nd day on higher Indonesia, Malaysia supply outlook
By Mei Mei Chu
KUALA LUMPUR, Sept 10 (Reuters) - Malaysian palm oil futures eased for a second straight session on Friday, hit by expectations of higher supply in major producers Indonesia and Malaysia, although the contract was set for a 1.3% weekly rise.
The benchmark palm oil contract FCPOc3 for November delivery on the Bursa Malaysia Derivatives Exchange slid 27 ringgit, or 0.61%, to 4,365 ringgit ($1,054.86) a tonne by the midday break.
Malaysia's end-August palm oil stocks surpassed industry surveys with a 25% surge from the previous month to 1.87 million tonnes, its highest in 14 months, according to Malaysian Palm Oil Board (MPOB) data.
Production rose 11.8% while exports plunged 17%, MPOB said during the midday break.
MPOB data showing sharply higher inventories is significant as Indonesian Palm Oil Association (GAPKI) also estimated higher July end-stocks, said Anilkumar Bagani, research head of Mumbai-based vegetable oils broker Sunvin Group.
"The combined Indonesia and Malaysia July end-stocks are now above 6 million tonnes," he said.
Top producer Indonesia's crude palm oil output in July stood at 4.1 million tonnes, up 5.4% from a year ago but down 9.5% from June, GAPKI data showed on Thursday.
Meanwhile, cargo surveyors reported Malaysia's exports during Sept. 1-10 rose between 50% and 57% from the same period in August due to larger shipments to India and China.
But the upward export momentum is unlikely to sustain during the second half of September, Bagani said.
Dalian's most-active soyoil contract DBYcv1 fell 1.8% while its palm oil contract DCPcv1 slipped 2.9%. Soyoil prices on the Chicago Board of Trade BOcv1 were down 0.3%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
($1 = 4.1380 ringgit)
(Reporting by Mei Mei Chu; Editing by Devika Syamnath)
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