Palm Futures Seen Staying Firm

Crude palm oil (CPO) futures prices on Bursa Malaysia Derivatives are likely to stay firm next week on production concerns due to the monsoon, dealers said. They said the heavy rains would encourage investors to take heavy positions. “The commodity will continue to be in short supply. Exports will surpass production next month as the monsoon season will dampen yields and the floods will also cause difficulties to transport the product to refineries and ports,” a dealer said. He said the CPO prices were expected to be traded at between RM2,450 and RM2,550 per tonne next week.

The market was traded mostly higher throughout the holiday-shortened week. It was closed on Friday for Hari Raya Aidiladha celebrations. On Thursday-to-Friday basis, CPO futures for December 2009 contract surged RM88 to RM2,458 a tonne, January 2010 rose RM80 to RM2,472, February 2010 added RM63 to RM2,482 and March 2010 gained RM70 to RM2,485. Turnover declined to 76,799 lots from 85,312 lots last week while open position slipped to 94,308 contracts from 96,736 contracts previously. On the physical market, the newly-traded December South contract ended the week at RM2,440 per tonne. The November South contract expired this week. — Bernama Source : Business Times

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