8/3/2001(Business Times) - Palm oil prices, which saw gains of RM30 atonne yesterday, may see the uptrend moderate in the near term as thecurrent level of between RM1,200 and RM1,300 may start to deter freshuptake by traditional buyers, dealers say."Players are closely monitoring developments in the US market. . . .especially the rival oils," a trader told Business Times in Kuala Lumpuryesterday.The fundamentals however remain intact, with demand from big buyers likeIndia providing support for the prices at the RM1,200 level, he said.India is expected to report a lower output of vegetable oils this year inlight of an extended drought in the subcontinent. And with demand seenrising in the months through to Deepavali in November, palm oil isexpected to enjoy brisk business.Traders said recent developments in Indonesia also augur well for thesector, especially the republic's plan to reduce exports of the commodityto meet domestic demand.Indonesia produces about 7 million tonnes of palm oil a year, of which 3million tonnes are exported. Only Malaysia produces more of the commodity,at over 10 million tonnes.At the sound of the bell yesterday, the spot crude palm oil (CPO) futurescontract on the Malaysia Derivatives Exchange (MDEX) shot up to RM1,275 atonne. But profit-taking surfaced later in the day to trim the gain andspot August closed at RM1,262 a tonne for a net gain of RM30, as didSeptember futures at RM1,265.October meanwhile put on RM32 to RM1,268, and November RM31 to RM1,271.Total volume was a heavy 3,463 lots compared to 2,685 lots on Tuesday,while open interest stood at 11,263 contracts, up from 10,905 contracts.In the physical market, August South CPO was traded at RM1,275 a tonnecompared to Tuesday's RM1,245.