JAKARTA (Dow Jones)--Crude palm oil futures on Malaysia's derivatives
exchange ended lower Friday on profit-taking and liquidation of long positions
ahead of the weekend, as sharp recent gains have raised the possibility of a
near-term correction, said trade participants.

  The benchmark July contract ended MYR19 down at MYR2,665 a metric ton.

  Stronger export data on-month helped to keep prices in positive territory
during morning trade, but by the afternoon players were keen to book profits
and square off positions ahead of the weekend, said traders.

  Malaysia's palm oil exports rose 1.7% on month during the May 1-15 period to
624,052 tons, according to estimates by cargo surveyor Intertek Agri Services.

  Another cargo surveyor, SGS (Malaysia) Bhd. estimated May 1-15 exports at
629,364, up 8% from the same period last month.

  Both sets of data were slightly above market expectations of 620,000 tons,
but were largely seen as neutral and not providing much of a boost to prices,
said traders.

  Some participants said a downward price correction is just around the corner
as prices have climbed too high and too quickly.

  "The supply rally has been overdone, there is a possibility of the August
contract falling towards MYR2,500/ton during the second half of May," said S.
Paramalingam, executive director of Malaysia-based commodities brokerage
Pelindung Bestari.

  August will be the benchmark third-month contract on BMD as of next week, as
the May contract expired Friday.

  Part of the rally in prices since early-April was due to investors cutting
their losses by covering short positions, he said.

  Many investors have now also liquidated long positions, pulling down open
interest from levels above 90,000 lots to around 75,000 lots in the last few
weeks.

  London-based vegetable oils analyst Dorab Mistry will give his next price
forecast on Monday during a vegetable oils conference in Tokyo.

  The conference will be addressed by Malaysia's new Minister for Plantation
Industries and Commodities Bernard G. Dompok.

  In other news, an Indian daily, Hindu Business Line, reported Friday that
importers plan to challenge a notice from the customs department demanding a
four per cent countervailing duty on all vegetable oils that have been brought
into the country since Dec. 7 last year.

  Traders said controversy over duties can potentially slowdown imports if not
resolved quickly.

  Palm oil cash market prices fell Friday on a lack of buying interest.

  "Many traders are keeping away due to volatility," a Malaysia-based exporter
said. Buyers are expecting a near-term downward correction in prices and won't
commit to deals until prices stabilize, he said.

  Open interest in CPO on the BMD rose to 75,553 lots Friday from 75,467 lots
Thursday. Traded volume fell to 14,855 lots from 17,659 lots. One lot comprises
25 tons.

  Cash palm olein for June traded at $840/ton, a trader in Singapore said.

  Cash CPO for prompt shipment was offered MYR60 lower at MYR2,800/ton.

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


Month      Close    Previous   Change   High    Low
May 09     2,849    2,800      Up 49    2,849   2,830
Jun 09     2,731    2,762      Dn 31    2,816   2,724
Jul 09     2,665    2,684      Dn 19    2,753   2,655
Aug 09     2,612    2,655      Dn 43    2,706   2,605