02.06.2021 (www.todayonline.com) -

* Palm up after two consecutive sessions of losses

* Lockdown hurts domestic demand prospects for June

* Malaysia stocks seen slightly lower or unchanged - analyst (Updates with midday prices, adds quotes)

By Mei Mei Chu

KUALA LUMPUR, June 2 (Reuters) - Malaysian palm oil futures rose 2% on Wednesday after two straight sessions of declines, as dry weather in the U.S. and Canadian crop belts and reduced crop expectations in South America stoked worries over global edible oil supply.

The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange gained 77 ringgit, or 1.98%, to 3,968 ringgit ($962.17) a tonne by the midday break.

Price gains were limited by expectations of lower domestic consumption due to a two-week lockdown, with sluggish exports in May further hurting demand prospects.

"Demand is a major concern in June, and we are witnessing greater competition from Indonesia," said Paramalingam Supramaniam, director at Selangor-based brokerage Pelindung Bestari.

Malaysia's palm inventories likely edged lower or remained unchanged from April, and will steadily rise from June, he said, adding that it would keep prices capped.

Refinitiv Commodities Research maintained its 2020/21 output forecast for top producer Indonesia at 46.8 million tonnes, despite a recent setback due to adverse weather conditions and lesser working days in May versus April.

The U.S. Department of Agriculture said U.S. farmers planted 84% of their intended soybean acreage, below the average estimate in the Reuters poll of 87%.

Dalian's most-active soyoil contract rose 1.4%, while its palm oil contract gained 1.2%. Soyoil prices on the Chicago Board of Trade were up 0.3%.

Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.

A bearish target of 3,738 ringgit per tonne has been aborted for palm oil, as it is stabilising around a support at 3,888 ringgit, Reuters technical analyst Wang Tao said.

($1 = 4.1240 ringgit) REUTERS

Read more at https://www.todayonline.com/world/vegoils-palm-climbs-2-global-edible-oil-supply-worries