Growing export demand, sluggish production pace keep CPO futures higher at close
21/09/2022 (The Edge Markets), Kuala Lumpur - The crude palm oil futures contract on Bursa Malaysia Derivatives ended higher for the second consecutive day on Wednesday on growing export demand and sluggish production pace, a dealer said.
Palm oil trader David Ng said the escalating political tension between Ukraine and Russia also pushed the market higher on Wednesday.
He located the support level at RM3,500 per tonne and resistance at RM4,000 per tonne.
Meanwhile, Singapore-based Palm Oil Analytics owner and co-founder Sathia Varqa said palm oil futures rose strongly, drawing on a solid rise in the September 1-20 exports and a higher Dalian against a slowdown in production as suggested by the Southern Malaysian Palm Fruit Manufacturers Association (SPPOMA) data.
“The September 1-20 exports rose 39 per cent while production eased 1.84% for the same period, reflecting yields may take time to recover after a robust rise in August,” he told Bernama.
At the close, the CPO futures contracts for the spot month of October 2022 rose RM131 to RM3,807 per tonne, November 2022 was up RM154 to RM3,856 per tonne, December 2022 added RM150 to RM3,887 per tonne and January 2023 was RM147 higher at RM3,915 per tonne.
February 2023 improved RM141 to RM3,950 per tonne and March 2023 added RM135 to RM3,983 per tonne.
Total volume increased to 110,533 lots from 93,585 lots on Tuesday while open interest widened to 269,676 contracts from 262,125 contracts previously.
The physical CPO price for October South was higher by RM100 to RM3,750 per tonne.