19/07/2012 (Reuters) - Malaysian crude palm oil futures slid to a near three-week low on Wednesday, as traders booked profits partly on weaker exports and better production outlook in Malaysia after a recent U.S. weather-fuelled rally.

Malaysia's July 1-15 palm oil exports tumbled more than 20 percent from a month ago at a time when stronger production is expected for the month. Slower exports and higher output could see palm oil stocks climb again after falling to a 14-month low in June.

But some traders kept a bullish outlook as the U.S. drought that damaged soybean crops could still shift demand to refined palm oil that is trading at a discount of above $200 to soyoil.

"I think the market just doesn't have enough push to go up further at the moment," said a Singapore-based trader with a commodities house.   

The benchmark October palm oil futures on the Bursa Malaysia Derivatives Exchange fell 2.2 percent to close at 2,994 ringgit ($947) per tonne, after going as low as 2,990 ringgit -- a level unseen since June 28.

Traded volumes were high at 39,170 lots of 25 tonnes each, compared to the usual 25,000 lots.

Technicals remain bearish as palm oil will extend its Tuesday loss to 2,973 ringgit, said Reuters market analyst Wang Tao, based on a wave analysis.

Cargo surveyor Intertek Testing Services reported a 21 percent decline in Malaysian exports for July 1-15. Another cargo surveyor, Societe Generale de Surveillance, posted a 26.1 percent drop in exports for the same period.

Global traders are watching the weather damage on U.S. crops as the worst drought since 1956 could trigger a serious shortage of oilseeds and vegetable oils, boosting prices and stirring food-driven inflation.

The U.S. Department of Agriculture rated soybean crop at 34 percent good-to-excellent in a Monday report, down 6 percentage points from the previous week.

There is also the possibility of an El Nino weather pattern returning to Southeast Asia at the end of the year, bringing drought and crimping palm oil production.

Although climate indicators for an El Nino event in the western Pacific have eased slightly in the past fortnight, meteorologists still expect the weather pattern to form late in 2012.  

Oil retreated slightly on Wednesday, snapping five days of gains as U.S. Federal Reserve Chairman Ben Bernanke offered few signs of further monetary stimulus and a gloomy view of the economy of the world's top oil consumer.

Other vegetable oil markets also traded lower. By 1007 GMT, the most active U.S. soyoil for December delivery fell 0.7 percent and the most active January 2013 soyoil contract on the Dalian Commodity Exchange lost 1 percent.     

  Palm, soy and crude oil prices at 1006 GMT

  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      AUG2    2970   -72.00    2970    3040     923
  MY PALM OIL      SEP2    2982   -74.00    2982    3058    6314
  MY PALM OIL      OCT2    2994   -68.00    2990    3067   24933
  CHINA PALM OLEIN JAN3    8038  -146.00    8004    8186  323388
  CHINA SOYOIL     JAN3    9744   -96.00    9702    9858  553480
  CBOT SOY OIL     DEC2   54.60    -0.39   54.53   55.19    8889
  NYMEX CRUDE      AUG2   88.80    -0.42   88.59   89.23   20182

  Palm oil prices in Malaysian ringgit per tonne
  CBOT soy oil in U.S. cents per pound
  Dalian soy oil and RBD palm olein in Chinese yuan per tonne
  Crude in U.S. dollars per barrel
  ($1=3.163 Malaysian ringgit)