11/09/2008 (The News International), Jakarta - Malaysian crude palm oil futures were little changed on Wednesday but dealers said they expected to see a rise in the afternoon session following news of bullish exports and lower-than-expected stocks data.

Official crop agency Malaysian Palm Oil Board said on Wednesday that Malaysian crude palm oil stocks fell 6.5 per cent to 1,848,130 tonnes in August, from a revised 1,977,397 tonnes in July. A Reuters’ poll had forecast palm oil stocks to rise 1.2 per cent in August from a month earlier.

Malaysian palm oil output for August rose 2.5 per cent from July, while exports jumped 4.6 per cent from a month earlier. “The data should be seen as positive news,” said Sari Lesmana, an analyst at Macquarie Research in Jakarta.

The data should remove concerns among traders that stocks could have risen to above 2 million tonnes, a situation that would otherwise discourage buying interest, a trader at a local brokerage said. He added that news of an OPEC production cut could also provide support for palm futures, as it had sparked a rebound in the crude oil price.

The price of the reddish-brown oil has fallen 22.89 per cent so far this year and is 47.57 per cent below an all-time high of 4,486 ringgit hit in March. The decline was largely due to concerns about high stocks and news of defaults from key buyers India and China.

The benchmark November crude palm oil contract on the Bursa Malaysia Derivatives Exchange fell 2 ringgit, or 0.08 per cent, to 2,352 ringgit ($680) a tonne by the midday break, having lost 35 ringgit, or 0.1 per cent, earlier. The overall volume reached 2,342 lots of 25 tonnes each. The October and December contracts each fell 5 ringgit.