Festive Demand Drives Up CPO Futures

CRUDE palm oil (CPO) futures ended firmer yesterday on Bursa  Malaysia Derivatives driven by the festive demand for the commodity against a backdrop of tight supply, dealers said.

An analyst said prices could hover around RM2,650 per tonne due to supply constraints brought on by the El Nino phenomena and competition from close substitutes.

Crude palm oil moves in tandem with soyoil as they compete for  similar export destinations.

At close yesterday, August 2010 increased RM25 to RM2,700 per tonne, September 2010 rose RM13 to RM2,645 per tonne, October 2010 gained RM29 to RM2,619 per tonne and November 2010 added
RM26 higher to RM2,613 per tonne.

Volume surged to 17,144 lots yesterday, from 12,945 lots on Wednesday, and open interest declined to 67,272 contracts, from 68,584 contracts previously.

On the physical market, August South was RM30 higher at RM2,710 per tonne.

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