KUALA LUMPUR (Dow Jones)--Crude palm oil futures on Malaysia's derivatives
exchange ended lower Friday on long liquidation, but an improvement in the
demand outlook stemmed the slide in prices, trade participants said.

  Trading was restrained by caution ahead of the release of global supply and
demand estimates for crops including soybeans, wheat and corn in a report by
the U.S. Department of Agriculture due at 1230 GMT.

  The benchmark September CPO contract on the Bursa Malaysia Derivatives ended
MYR37 lower at MYR2,010 metric ton, after trading in a range of
MYR2,002-MYR2,058/ton.

  "Prices were volatile as day traders had expected prices to move higher on
improved exports. When prices were not able to move to levels beyond MYR2,060,
many liquidated their positions which led to a fall in prices on BMD," a Kuala
Lumpur-based trading executive said.

  Malaysia's palm oil exports for the July 1-10 period rose 38% from the same
period last month to 387,379 tons, according to cargo surveyor SGS (Malaysia)
Bhd. Earlier in the day, another surveyor, Intertek Agri Services, estimated
shipments for the same period to be up 45% at 419,199 tons.

  The estimates were roughly in line with expectations of between 350,000 and
400,000 tons, but players remained cautious ahead of the USDA report.

  Malaysia's palm oil stocks rose 2.5% on month to 1.41 million tons in June
from 1.37 million in May, below market expectations of between 1.43 million and
1.46 million tons.

  "The jump in palm oil stocks was limited, which eased concerns on the supply
side. Robust demand from China, the European Union and India has shown that
demand may be picking up in July, so that may keep prices at current levels in
the near term," a trading executive from a Kuala Lumpur-based global
commodities brokerage said.

  Export data from Intertek showed that palm oil imports to China were likely
up 35% on month to 148,365 tons during the July 1-10 period, while shipments to
the E.U. were up 23% to 97,905 tons. SGS estimated palm oil exports to India in
the period at 23,040 tons.

  Traders said prices may stay in a MYR2,000-MYR2,100 range in the near term.

  In the cash market, palm olein for August/September shipment was traded at
$634/ton, and for September shipment at $632.50, a Singapore-based trader said.

  Cash CPO for prompt shipment was unchanged at MYR2,060/ton.

  CPO futures trading volume rose to 14,428 lots from 12,600 lots Thursday.
Open interest also rose to 65,836 lots from 65,314 lots. One lot is 25 tons.

Closing BMD CPO futures prices in MYR/ton at 1000 GMT:

Month      Close    Previous   Change   High    Low
Jul 09     2,035    2,050      Dn 15    2,035   2,035
Aug 09     2,030    2,055      Dn 25    2,063   2,021
Sep 09     2,010    2,047      Dn 37    2,058   2,002
Oct 09     2,015    2,050      Dn 35    2,057   2,005