CPO settled down -0.4% at 528.6 as buying interest dried up ahead of a key stocks report kept investors on the sidelines. However, ample inventories in the physical market on increased supplies from the major producing belts, capped some gains. Exports of Malaysian palm oil products in June increased 5.8% to 1,391,942 tonnes from 1,315,952 tonnes shipped in May. Malaysia has cut export tax for July to 5% from 5.5% while Indonesia has cut export tax to 10.5% from 12%. Palm oil purchases by China may decline by about 11% this year as economic expansion slows and banks tighten lending to commodity importers. Palm oil imports by India, declined after refiners bought more soybean and sunflower oils amid record global supplies. Shipments of crude and refined palm oils slid 14% to 647,756mts last month from a year earlier, the SEA of India said. Climatologists estimate that an El Nino pattern may develop by September, a little later than the initial estimate for July-August. Between January and May 2014, average CPO prices increased by 5% from a year earlier, partly reflecting market anticipation of the El Nino pattern. Historically, a severe El Nino would result in a 10%-15% drop in CPO production volume, and a 30%-40% increase in average selling prices. In addition, Indonesia's demand for CPO for blending into biodiesel has not increased so far in 2014 compared with 2013. Technically market is under fresh selling as market has witnessed gain in open interest by 2.72% to settled at 3933 while prices down -0.7 rupee, now CPO is getting support at 528.3 and below same could see a test of 526.6 level, And resistance is now likely to be seen at 531.6, a move above could see prices testing 533.2.

Trading Ideas:

CPO trading range for the day is 524.8-533.4.

Crude palm oil ended with losses as buying interest dried up ahead of a key stocks report kept investors on the sidelines.

However, ample inventories in the physical market on increased supplies from the major producing belts, capped some gains.

Exports of Malaysian palm oil products in June increased 5.8% to 1,391,942 tonnes from 1,315,952 tonnes shipped in May.

Crude palm oil prices in spot market gained by 1.10 and settled at 535.90 rupees.