Malaysia palm oil falls on exports, vegoil supplies

Malaysian crude palm oil futures slipped nearly 1 percent on Tuesday as a lower than expected increase in exports and expectations of rising vegetable oil supplies weighed on the market.

Dealers said a decision by Argentine farm groups to end a two-week strike over soy export taxes raised hopes of more shipments from the world's No. 3 soy supplier.

By the midday break, the benchmark August contract on the Bursa Malaysia Derivatives Exchange fell 34 ringgit to 3,536 ringgit ($1,093) per tonne.

"The sentiment is weak because Argentine farmers are ending their strike which will certainly ease pressure on supplies," said one trader with a leading plantation company.

Other traded months fell between 20 and 31 ringgit. Overall trade dropped to 1,146 lots of 25 tonnes each from around 5,000 lots that change hands during the morning session on a routine trading day.

Exports of Malaysian palm oil products for May 1-20 rose 6 percent to 830,873 tonnes from 782,609 tonnes shipped between April 1 and 20, cargo surveyor Intertek Testing Services said on Tuesday.

"The market was expecting exports to be higher than 900,000 tonnes, it is disappointing to see exports slowing down," the plantation company trader said.

Another cargo surveyor, Societe Generale de Surveillance, is due to release its estimates later on Tuesday.

In Malaysia's physical market, crude palm oil for May shipment in the southern region was quoted at 3,540/3,570 ringgit.