11/08/2012 (Business Recorder) - Malaysian crude palm oil futures ended off an 8-week low on Friday, and posted a fifth straight weekly loss with traders positioning ahead of a key report by the US Department of Agriculture (USDA) later in the day. Palm oil initially went to its lowest since June 15 after cargo surveyor Intertek Testing Services reported a 1.8 percent fall in exports for the first ten days of August from a month ago.

But prices pulled back on short-covering ahead of USDA's monthly supply and demand report at 1230 GMT that is likely to show a tighter soy output and squeeze soybean oil supply, shifting some demand to palm oil. "The USDA report tonight is the most important. If it is bearish, we will see palm oil go down fast to 2,700 and 2,600 ringgit. If it is bullish, it will try to crawl above 3,000 ringgit," said a Malaysian planter. At closing, the benchmark October palm oil futures on the Bursa Malaysia Derivatives Exchange edged up 0.6 percent to 2,882 ringgit ($925) per tonne. Prices touched a low of 2,844 ringgit, a level last seen on June 15.

Palm oil ended the week 1.2 percent lower, the fifth consecutive week that the edible oil is in the red. Total traded volumes were high at 28,005 lots of 25 tonnes each on short-covering, compared to the usual 25,000 lots. Malaysia palm oil stocks hit a five-month high of nearly 2 million tonnes, almost in line with market expectations, industry regulator Malaysian Palm Oil Board said after the midday break.

And the build up could continue as exports of the edible oil remain sluggish with cargo surveyor Intertek Testing Services reported Aug 1-10 exports at 357,372 tonnes, compared to 363,975 tonnes a month ago. Another cargo surveyor Societe Generale de Surveillance reported a 6.8 percent increase for the same period, but traders said that could be due to a low base effect in July.

As festival demand has eased, traders are hoping that the recently announced tax-free crude palm oil export quotas of 2 million tonnes could help bolster demand and help reduce stocks in coming months. In other vegetable markets, the most active US soyoil contract for December delivery had lost 0.2 percent and the most active January 2013 soyoil contract on the Dalian Commodity Exchange had gained 0.3 percent.goodies to settlers in Masjid Ubudiyiah, Felda Chemomoi, here.