* Palm oil prices capped by high production and growing stockpile -analyst * October exports up 9.3 pct -SGS * Indonesia will not change its policy tax structure -official * Palm oil's target adjusted to 2,468 ringgit -technicals (Updates prices, adds SGS exports data) By Anuradha Raghu KUALA LUMPUR, Oct 31 (Reuters) - Malaysian palm oil futures inched down on Wednesday as the strongest exports recorded for this year may do little to cut into high stocks at a time when output is surging in the world's second largest producer of the edible oil. Cargo surveyor data showed that Malaysian palm oil shipments in October climbed to about 1.6 million tonnes -- the highest this year, although stocks are set to hit another record beyond 2.48 million tonnes. "Based on the shipment number, we will still end up with a higher stockpile because October's production is still very high," said OSK Research analyst Alvin Tai. "Exports rising higher month-on-month is not surprising, but the quantum still needs to be stronger." The benchmark January contract on the Bursa Malaysia Derivatives Exchange closed 0.2 percent lower at 2,496 ringgit ($819) per tonne. Total traded volumes stood at 28,495 lots of 25 tonnes each, slightly higher to the usual 25,000 lots. Technicals showed that the bearish target of 2,379 ringgit per tonne for Malaysian palm oil has been adjusted to 2,468 ringgit based on its falling speed, said Reuters market analyst Wang Tao. Palm oil dropped to a two-week low earlier this week after its biggest rival and top producer Indonesia planned to lower monthly export taxes in November after international prices fell this month. The lower taxes will lift margins for Indonesians and shift demand away from competing Malaysian products. Officials in Jakarta said they will not alter their tax structure which is aimed at driving its domestic palm oil downstream industry. "The export tax structure is progressive and it has been adjusted to fluctuated palm oil prices in the international market," director general of agriculture-based industry Benny Wachjudi said at an industry meeting. "It is very different from the Malaysian government's export tax policy. I am sure Malaysian export tax policy will not last long because it is not adjusted to the development on palm oil prices in the international market." Brent crude held steady near $109 a barrel on Wednesday after the huge storm Sandy whiplashed the U.S. East Coast, reducing fuel demand even as refineries in the region gradually resumed operations. U.S. soyoil for December delivery inched up 0.7 percent in late Asian trade. The most-active May 2013 soybean oil contract on the Dalian Commodity Exchange rose 0.7 percent. Palm, soy and crude oil prices at 1018 GMT Contract Month Last Change Low High Volume MY PALM OIL NOV2 2394 +2.00 2379 2401 278 MY PALM OIL DEC2 2445 -6.00 2440 2471 1940 MY PALM OIL JAN3 2496 -5.00 2492 2529 15877 CHINA PALM OLEIN MAY3 7046 +22.00 6950 7060 601068 CHINA SOYOIL MAY3 9070 +66.00 8980 9082 562136 CBOT SOY OIL DEC2 50.42 +0.33 50.07 50.59 9665 NYMEX CRUDE DEC2 86.37 +0.69 85.61 86.59 16633 Palm oil prices in Malaysian ringgit per tonne CBOT soy oil in U.S. cents per pound Dalian soy oil and RBD palm olein in Chinese yuan per tonne Crude in U.S. dollars per barrel

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