30/03/2013 (Bangkok Post) - Palm oil prices declined to the lowest level in almost two weeks, heading for a fourth quarterly loss, on concern that demand will slow as Europe's debt crisis lingers, swelling inventories in producing countries.

Palm oil prices have tumbled 31% over the past year as supplies from Indonesia and Malaysia, the largest producers, expanded to a record and demand fell in Europe. Stockpiles in Malaysia reached an all-time high in December.

The contract for June delivery fell 0.8% to 2,392 ringgit ($774) a tonne on the Malaysia Derivatives Exchange, the lowest most-active price since March 18 and down down 1.8% for the quarter.

A fourth consecutive quarterly loss would be the worst run for the commodity since 1999.

Shipments to European Union countries by Malaysia tumbled 18% in the first 25 days of March to 155,870 tonnes from a month earlier, according to Societe Generale de Surveillance. Total exports fell 7% to 1.1 million tonnes, it said on March 25.

Europe is the largest buyer of palm after India and China, US Department of Agriculture data show.

"Driving prices down is an expectation that exports from Malaysia will continue to decline," said Arhnue Tan, vice-president at Alliance Research Sdn in Kuala Lumpur. "That may lead to high inventory levels."