CPO futures to trade at current levels with upside bias next week
16/03/2024 (The Star Online), Kuala Lumpur - The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives is expected to trade at current levels with an upside bias next week.
Palm oil trader David Ng said the low stock level as well as the weaker-than-expected production pace could support the strong sentiment.
"Therefore, we expect the price to trade between RM4,150 a tonne and RM4,300 a tonne,” he told Bernama.
On the other hand, Interband Group of Companies senior trader Jim Teh opined that profit-taking activities might also take place next week, given the uptrend in CPO prices in the last two to three weeks.
"As for the stockpile, there is a lack of palm oil stock in the market in both Malaysia and Indonesia, so there will be pressure on that," he said, adding that CPO prices might trend between RM3,700 a tonne and RM3,900 a tonne next week.
For the week that just ended, CPO futures traded mostly higher amid a lower CPO stockpile in the country leading to a tight supply in the market, as well as tracking the stronger soyabean oil prices on the Chicago Board of Trade and Dalian Commodity Exchange.
On a weekly basis, the spot month March 2024 contract surged RM146 to RM4,327 a tonne, April 2024 rose RM163 to RM4,342 a tonne, and May 2024 gained RM193 to RM4,287 a tonne.
June 2024 soared RM238 to RM4,220 a tonne, July 2024 perked up RM255 to RM4,125 a tonne, and August 2024 climbed RM239 to RM4,037 a tonne.
The total weekly volume advanced to 423,388 lots from 305,220 lots in the previous week, while open interest widened to 291,546 contracts from 276,573 contracts previously.
The physical CPO price for March South stood at RM4,360 per tonne, up RM140 from RM4,220 per tonne last week. – Bernama