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. Last Updated: 07/27/2016

Malaysian Palm Oil Deal Questioned

KUALA LUMPUR, Malaysia -- An agreement between Malaysia and Russia to trade palm oil for warplanes has been received coolly by the palm oil industry because conditions of the deal remain unclear, traders and exporters said Thursday.

Malaysia is expected to sell more than 1 billion ringgit ($263 million) worth of palm oil to Russia as part of benefits to offset a defense contract signed by both governments during President Vladimir Putin's visit to Kuala Lumpur last week.

But industry participants in Malaysia, the world's largest producer of palm oil, have paid little heed to the deal, since the pricing, timing and conditions of the palm oil sale have not been finalized.

"Producers need to see how the value of the deal will be worked out," said the head of marketing of a Malaysian refinery, which exports some products to Russia. He spoke on the condition of anonymity.