CPO settled up 1.27% at 535.3 on improved demand ahead of the Muslim holy month of Ramadan. Further, tight stocks position in the physical market and expectations of lower production from the major producing belts too supported prices. A median forecast of planters, pegged Malaysia's June ending stocks at 1.8mtns, a 2.2-percent drop from a month ago, which would mark the first fall in inventories since March. The official report on Malaysia's end-June palm stocks, production and exports will be released by industry regulator the Malaysian Palm Oil Board.

More weather pattern support an El Nino event have emerged in the recent weeks and is likely to occur in September. 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. Technically market is under short covering as market has witnessed drop in open interest by -7.98% to settled at 3561 while prices up 6.7 rupee, now CPO is getting support at 527.3 and below same could see a test of 519.4 level, And resistance is now likely to be seen at 539.8, a move above could see prices testing 544.4.

Trading Ideas:

CPO trading range for the day is 519.4-544.4.

Crude palm oil gained on improved demand ahead of the Muslim holy month of Ramadan.

Further, tight stocks position in the physical market and expectations of lower production too supported prices.

A median forecast of planters, pegged Malaysia's June ending stocks at 1.8mtns, a 2.2-percent drop from a month ago.

Crude palm oil prices in spot market gained by 1.20 and settled at 537.10 rupees.