The low prices, down almost 27 percent so far this year, have enabled the Malaysian government to set the crude palm oil export tax for January at zero percent, which could see Malaysia grab more market share from top producer Indonesia. Traders are even expecting February taxes to remain at zero. "Today the market is still trying to find a base. Technically, they are trying to set it down below 2,300 ringgit per tonne," said a trader with a foreign commodities brokerage.
At the close, the benchmark March contract on the Bursa Malaysia Derivatives Exchange inched down 0.4 percent to 2,321 ringgit ($760) per tonne. Total traded volumes stood at 36,567 lots of 25 tonnes each, much higher the usual 25,000 lots. Technical analysis showed that a bearish target of 2,217 ringgit per tonne has been established for palm oil, Reuters market analyst Wang Tao said.
Exports in the first twenty days of the month fell a 1.9 percent compared to November, cargo surveyor Intertek Testing Services said on Thursday. Another cargo surveyor Societe Generale de Surveillance reported a slight 0.5 increase for the same period. In other competing vegetable oil markets, US soyaoil for January delivery fell 0.4 percent in late Asian trade Soybean prices have come under pressure after China scrapped a contract for 300,000 tonnes of US soy recently. The most active May 2013 soybean oil contract on the Dalian Commodity Exchange fell 1.5 percent.