Palm slips to 1-week low

Malaysian palm oil futures hit a one-week low on Thursday, stretching losses into a third day as investors continued to take profits from last week's steep gains, but prices were stuck in a range ahead of key output and inventory data.

Production in Southeast Asia, which accounts for nearly all of the world's palm oil supply, may have tapered off sooner than expected this year as the monsoon season hampered harvesting.

Investors are eyeing official data from Malaysia, the world's No.2 producer, on palm oil stocks, exports and output in October that will be released by industry regulator the Malaysian Palm Oil Board on November 11.

"The market is quiet. Prices are moving in a RM2,550-RM2,600 range as investors wait for new leads," said a trader with a foreign commodities brokerage.

By the mid-day break, the benchmark January contract on the Bursa Malaysia Derivatives Exchange had edged down 0.2 per cent to RM2,541 per tonne.

Palm oil prices, which traded in a range of RM2,539-RM2,562, have shed 3.3 per cent so far this week after last week's almost eight per cent gain, the biggest such rise since 2010.

Total traded volume stood at 13,828 lots of 25 tonnes each on Thursday, marginally higher than the usual 12,500 lots.

Technicals were a little bearish.

Malaysian palm oil is expected to break support at RM2,544 per tonne and fall further towards RM2,491, Reuters market analyst Wang Tao said.

The price of the tropical oil could however get a boost from prospects of a drop in output and stronger Asian demand.

China, the world's second-biggest palm oil buyer, is expected to begin re-stocking the edible oil ahead of its Lunar New Year festival celebrated at the end-January.

"We would expect China to increase palm oil imports in the upcoming months, especially after the winter season," said Phillip Futures analyst Tan Chee Tat in a note on Thursday.

In other markets, Brent crude slipped below US$105 a barrel to its lowest since early July as investors were reluctant to lock in fresh positions ahead of key announcements due later in the day from Europe and the United States.

In competing vegetable oil markets, the US soyoil contract for December fell 0.1 per cent in early Asian trade. The most-active May soybean oil contract on the Dalian Commodities Exchange fell 0.1 per cent