By Emily Chow
KUALA LUMPUR (Reuters) - Malaysian palm oil futures were poised for a third straight session of declines on Thursday, as traders took a cautious stance over mounting China-U.S. trade war friction and on the lack of bullish news.
The benchmark palm oil contract for September delivery on the Bursa Malaysia Derivatives Exchange was down 0.3 percent at 2,291 ringgit ($566.52) a tonne at noon.
Trading volumes stood at 21,708 lots of 25 tonnes each at noon.
The Trump administration's decision to impose tariffs on $34 billion in Chinese exports to the United States is due to go into effect on Friday. China said its tariffs on U.S. goods will take effect immediately after Washington's tariffs on Chinese goods kick-in.
"The market is cautious as anxiety over the U.S.-China trade war loomed in," said a Kuala Lumpur-based trader, while another trader said the lack of market-supportive news pulled down palm prices.
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Palm oil prices dropped 4 percent last month, hitting a two-year low on the back of lean demand. It declined 1.5 percent so far this week.
According to a Reuters poll, Malaysian inventories for June are seen edging down to a nine-month low at 2.15 million tonnes, while production is expected to decline 11.1 percent to 1.36 million tonnes, its lowest since February.
The poll also forecast exports to fall 7.8 percent to a three-month low of 1.19 million tonnes in June.
In other related oils, the September soybean oil on China's Dalian Commodity Exchange slid as much as 0.1 percent and the Dalian September palm oil contract climbed up to 0.1 percent.
The Chicago December soybean oil contract was closed for a public holiday on Wednesday.
Palm oil prices track the performance of other edible oils as they compete for a share in the global vegetable oils market.
Palm oil is biased to break a support at 2,290 ringgit per tonne and fall to the next support at 2,270 ringgit, said Wang Tao, a Reuters market analyst for commodities and energy technicals.
(Reporting by Emily Chow; Editing by Sherry Jacob-Phillips)
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