22/06/2012 (Reuters) - Malaysian crude palm oil futures edged lower on Thursday as traders booked profits from rallies earlier in the week, while sentiment also turned cautious on weak economic data and disappointing stimulus measures by the U.S. Federal Reserve.

Palm oil prices hit a three-week high after the midday break on concerns that dry weather in the United States could tighten global oilseeds supply, but the gain could not be sustained as bleak data showing a slowdown in Chinese and European factory activity took centrestage.

The move by the Fed to extend its programme of selling short-term securities and buying longer-dated ones disappointed investors who had hoped for a third round of quantitative easing, weighing on financial markets across the board.

Benchmark September palm oil futures on the Bursa Malaysia Derivatives Exchange slipped 1.4 percent to close at 3,000 ringgit ($945) per tonne. Prices went as high as 3,062 ringgit, a level unseen since June 1.

Traded volumes stood at 36,568 lots of 25 tonnes each, much higher than the usual 25,000 lots as activities picked up after the midday break. 

Palm oil prices are however on track for a more than 5 percent gain this week, after three straight weeks of losses.

"The Greek election brought in some funds buying," said a trader with a domestic commodities brokerage in Malaysia, referring to gains in palm oil earlier this week on optimism stemming from the victory of pro-bailout parties in Greece.

"However the surge also brought in demand destruction and palm olein prices above $990 saw very few takers."

Rising exports confirmed stronger demand for the tropical oil on last-minute buying ahead of the Muslim fasting month that starts in late July.

Malaysian palm oil exports grew 15 percent to above 990,000 tonnes in the first 20 days of the month, said cargo surveyor Intertek Testing Services and Societe Generale de Surveillance.

Adding to the supportive factors for palm oil was the dry weather in the United States as the U.S. Department of Agriculture (USDA) said unfavourable weather had damaged soybean crop quality.

A lower soybean crop to be crushed into soybean oil could shift more demand to the cheaper refined palm oil.

Brent crude oil hit an 18-month low of $91 per barrel on Thursday as the outlook for economic growth darkened, pointing to lower-than-expected energy consumption worldwide.

In other vegetable oil markets, U.S. soyoil for July  delivery lost 1.0 percent. The most active January 2013 soyoil contract on the Dalian commodity exchange edged down 0.2 percent.   

  Palm, soy and crude oil prices at 1012 GMT

  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      JUL2    2984   -51.00    2970    3032    1458
  MY PALM OIL      AUG2    2996   -49.00    2980    3054    4182
  MY PALM OIL      SEP2    3000   -41.00    2986    3062   23751
  CHINA PALM OLEIN JAN3    7946   -14.00    7882    7980  361144
  CHINA SOYOIL     JAN3    9440   -14.00    9396    9474  527894
  CBOT SOY OIL     JUL2   50.30    -0.51   50.16   50.84    9241
  NYMEX CRUDE      AUG2   80.68    -0.77   79.92   81.20   38496

  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=3.175 Malaysian ringgit)