KUALA LUMPUR (Dow Jones)--Crude palm oil futures on Malaysia's derivatives
exchange fell as much as 2.2% Wednesday as investors liquidated long positions
while slump in soyoil, crude oil futures weighed on prices, trade participants
said.

  The benchmark October CPO contract on the Bursa Malaysia Derivatives settled
MYR5 lower at MYR2,460 a metric ton after trading in a MYR2,410-MYR2,490/ton
range.

  Prices were very volatile in early trade, swinging in positive and negative
territory as investors booked profits. A sell-off in regional stock markets led
to heavy selling pressure in CPO prices, with investors liquidating long
positions when prices dipped to an intraday low of MYR2,410, trade participants
said.

  "CPO prices recovered from today's low as day traders came in to cover their
short positions ahead of a key crop report (by the U.S. Department of
Agriculture) due later today," said a trading executive from a Kuala
Lumpur-based commodities brokerage.

  Trade participants and analysts said the USDA may lower this year's estimate
of soybean production, as crop development had been slow.

  The fall in CPO prices may be temporary, said a Singapore-based trading
executive, as palm oil fundamentals remain strong and supportive of a near-term
uptrend.

  Prices may move in a MYR2,400-MYR2,500 range during the next trading session
and may test resistance at MYR2,500, and then at MYR2,530, another Kuala
Lumpur-based trading executive said.

  The fall in crude oil, soyoil Wednesday weighed on prices as well.

  September soyoil futures on the Chicago Board of Trade, which ended 154
points higher Tuesday at 38.16 cents a pound, fell 31 points on e-CBOT
Wednesday to 37.85 cents a pound by the end of trade on the BMD.

  September crude on Nymex rose from a low of $68.84 a barrel to trade 8 cents
higher at $69.53 a barrel at 1027 GMT.

  In the cash market, cash palm olein for October/November/December was traded
$7.50-$10 lower at $735/ton, $732.50/ton, $730/ton, FOB Malaysian ports, a
Singapore-based trading executive said.

  Cash CPO was offered unchanged at MYR2,500/ton.

  Open interest for CPO futures rose to 81,146 lots from 79,671 lots Tuesday
while trading volume fell to 17,914 lots from 23,676 lots. One lot is
equivalent to 25 tons.

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

Month      Close    Previous   Change   High    Low
Aug 09     2,495    2,500      Dn 05    2,495   2,495
Sep 09     2,475    2,480      Dn 05    2,493   2,428
Oct 09     2,460    2,465      Dn 05    2,490   2,410
Nov 09     2,442    2,452      Dn 10    2,477   2,398