Crude palm Oil on MCX settled down by -0.56% at 535.6 on profit booking after prices gained on supply concerns from top producers. Prices seen supported in last couple of sessions on supply worries after report published citing Thomas Mielke showed that during current calendar year world CPO output may drop by 3.3 million tons to 59.2 million tons as El-Nino brought scorching heat across Southeast Asia, hitting palm yields and lowering output, report said. In 2016, CPO output in Indonesia, the biggest palm oil producer, may fall by 100,000 tons to 32.2 million tons while in Malaysia, the world's second biggest palm oil producer, output is expected fall by 300,000 tons to 17.8 million tons. According to cargo surveyor Societe Generale de Surveillance, Malaysian’s October 1-10 palm oil exports rose 1.9 percent to 403,650 tons compared to 395,970 tons in corresponding period last month. Malaysian palm oil production is expected to drop by between five per cent and eight per cent this year due to the prolonged El Nino drought. Palm oil production in Malaysia, the second largest palm oil producer, has eased by 1.0 million tonnes to 1.5 million tonnes in the first half of this year due to the lingering effects of the El-Nino weather pattern. In 2015, Malaysian palm oil production stood at 19.96 million tonnes. Production in Indonesia had reduced substantially in the first half of the year, and output for the full year would be below last year’s level. Technically market is under long liquidation as market has witnessed drop in open interest by -1.48% to settled at 5732, now CPO is getting support at 533.5 and below same could see a test of 531.5 level, And resistance is now likely to be seen at 539, a move above could see prices testing 542.5.

Trading Ideas:

CPO trading range for the day is 531.5-542.5.

Crude palm oil prices ended with losses on profit booking after prices gained on supply concerns from top producers.

In 2016, CPO output in Indonesia, the may fall by 100,000 tons while in Malaysia, output is expected fall by 300,000 tons.

Malaysian’s October 1-10 palm oil exports rose 1.9 percent to 403,650 tons compared to 395,970 tons in corresponding period last month.

Crude palm oil prices in spot market dropped by 3.00 rupees and settled at 553.80 rupees.