29/7/04 KUALA LUMPUR (Dow Jones)--Asian cash palm oil prices were weakerThursday, with products in Malaysia moving slightly lower following heavylosses in soyoil futures.However, steady consumer demand helped cushion the negative impactfrom the soyoil drop on the Malaysian market, traders said.At the Chicago Board of Trade Wednesday, soy complex futures fellsharply amid bearish weather forecasts and a weakening cash market. Augustsoyoil ended 99 points lower at 23.25 cents a pound.Despite the sharp drop in soyoil futures, palm oil prices were onlyslightly lower.Traders said the recent disappointing weather in India was helping tosupport palm oil prices.They said, however, renewed buying interest from China was the mainfactor supporting the Malaysian market Wednesday."India, if there is demand, is going mostly for Indonesian CPO at themoment. The demand (in Malaysia) is coming mainly from the Chinese. Thereis a fair bit of them and that's why the market is holding even thoughChicago soyoil is down," a trader said.Chinese demand for palm oil has been on the rise lately amid strongerdomestic selling prices and tightening stock levels, traders said.China is the largest importer of palm oil.Demand from India, also a major consumer of palm oil, has slowed inthe past few days compared with the keen buying interest witnessed one totwo weeks ago, traders said.A lack of rains in India had raised concerns about domestic oilseedproduction and spurred active buying. However, those concerns have beeneased by a return of rains, traders said.A senior Indian government official said monsoon rains have revived inwestern and central parts of India over the past four days and rains areexpected to continue over the next three days.India's western and central parts are important oilseed growingregions.Traders said the progress of the Indian monsoon would continue to be akey influence on palm oil prices.Meanwhile, traders said they are also watching the movement of theIndonesian currency."One thing to watch out for is the rupiah. It's on a weakening trendnow. If it weakens further, we may see more selling pressure coming out ofIndonesia," a trader said, adding that producers in the country would bekeen to sell to take advantage of better returns in rupiah terms.Since last week, the rupiah weakened to more than IDR9,000 to the U.S.dollar. As of 0856 GMT, the dollar was trading at IDR9,170.In the cash market, CPO for August shipment was offered at 1,470ringgit($1=MYR3.8) a ton, down MYR10 from Wednesday, delivered basis in SouthMalaysia.RBD palm olein for August shipment was offered at $422.50/ton, down$2.5 from Wednesday.RBD palm oil for August shipment was at $412.50/ton, also down $2.5.In Indonesia, the government sold 5,000 tons of CPO at a semiweeklygovernment auction Thursday, said an official at PT Perkebunan Nusantara,the agency that sells palm oil from state-run plantations.The official said Thursday's auction price was down IDR42 a ton fromthe previous auction.PT Permata Hijau Sawit bought 2,000 tons, free on board Belawan, atIDR3,731/kg. It also bought 500 tons, FOB Dumai, at the same price.PT Nubika Jaya bought 2,000 tons, ex-plantations, at IDR3,670/kg.PT Multimas Nabati Asahan bought 500 tons, FOB Teluk Bayur, atIDR3,665/kg.RBD palm olein in Jakarta was offered at IDR4,300/kg, down IDR50 fromWednesday.