By Thomas Kutty Abraham Dec. 10 (Bloomberg) -- Palm oil futures in Malaysia dropped for a second day and headed for their first decline in six weeks after a decline in crude oil to its lowest level in two months cut demand for the commodity as a biofuel. The tropical vegetable oil for February delivery slumped as much as 1.5 percent to 2,489 ringgit a metric ton ($733), the lowest level in almost a week on the Malaysia Derivatives Exchange in Kuala Lumpur. The most-active contract traded at 2,498 ringgit a ton at 11:57 a.m. Singapore time. The commodity has lost 2.5 percent this week. “I expect some influence of crude and soybean oil on palm for the time being,” Ben Santoso, an analyst at DBS Vickers Securities (Singapore) Pte., said by phone from Singapore. Crude oil fell 2.7 percent yesterday to a two-month low after a government report showed that fuel inventories climbed in the U.S., the biggest energy consumer. Crude oil for January delivery today was little changed at $70.75 a barrel in electronic trading on the New York Mercantile Exchange. “Today’s decline is also due to profit-taking, but the bullish trend is still intact at least until the first quarter of next year,” Santoso said. Palm oil reached a six-month high of 2,606 ringgit a ton on Dec. 7. It dropped by the most in six weeks yesterday on speculation that stockpiles in Malaysia, the world’s second- biggest producer, may have risen in November. The Malaysian Palm Oil Board is scheduled to release the November data after 12:30 p.m. Singapore time today. Intertek Data Palm oil exports from Malaysia rose 2.2 percent to 412,166 metric tons in the first 10 days of December from the same period in November, independent market surveyor Intertek said in an e-mail statement in Kuala Lumpur. January-delivery soybean oil dropped 3 percent yesterday, the most in more than three months, and was little changed at 39.36 cents a pound at 12 p.m. Singapore time. The premium of soybean oil in Chicago over palm oil in Malaysia, which slumped 12.4 percent yesterday, jumped 9.8 percent to $135.01 a ton today, according to Bloomberg data. September-delivery palm oil traded on the Dalian Commodity Exchange dropped as much a 1.7 percent to 6,774 yuan a ton. The commodity traded at 6,784 yuan at 11:29 a.m. Singapore time. To contact the reporter on this story: Thomas Kutty Abraham at tabraham4@bloomberg.net

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