SINGAPORE: Malaysian crude palm oil futures inched lower on Monday on expectations of rising inventory levels, although losses were limited by a jump in exports that could help ease pressure, eating into high stock levels that have risen above 2 million tonnes.
The tropical oil was also tracking Chicago soybeans, which edged lower in Asian trade on hopes that late-season rains in the United States would help salvage some of the drought-hit oilseed crop.
The market lacked a clear direction as traders were awaiting August stocks data from the Malaysian Palm Oil Board, which after the midday break reported a 5.8 percent increase from a month earlier.
"The price movement is likely to hinge on the expectations as well as the official MPOB data. For palm oil futures today, this is the main highlight that we are watching," said Ker Chung Yang, commodities analyst with Phillip Futures in Singapore.
By the midday break, the benchmark November contract on the Bursa Malaysia Derivatives Exchange had edged down 0.3 percent to 2,918 ringgit ($941) per tonne, extending losses to a fifth consecutive session.
Total traded volume stood at 14,808 lots of 25 tonnes each, slightly higher than the usual 12,500 lots.
Malaysia's August palm oil stocks rose 5.8 percent to 2,125,214 tonnes from a revised 1,999,066 tonnes in July on high production and beat market expectations of 2.09 million tonnes.
Malaysia's palm oil exports continued a strong performance from August, rising almost 27 percent for the Sept. 1-10 period on higher crude product shipments, cargo surveyor Intertek Testing Services said on Monday.
Another cargo surveyor, Societe Generale de Surveillance, will issue exports numbers later in the day.
Japan's weather bureau said on Monday that its climate models indicated the El Nino phenomenon, which brings crop-damaging hot and dry weather to Southeast Asia, was under way and there was a high chance it would last until winter.
In a bullish signal for palm oil, Brent crude futures climbed above $114 per barrel on Monday, but gains were limited as expectations for the US Federal Reserve to launch further stimulus measures offset weak Chinese industrial output data.
In other vegetable oil markets, US soyoil for December delivery rose 0.5 percent and the most active January 2013 soyoil contract on the Dalian Commodity Exchange had lost 0.3 percent by 0536 GMT.
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