Palm Futures to Consolidate Further

Crude palm oil (CPO) futures prices on Bursa Malaysia Derivatives are expected to consolidate further next week amid

uncertainties in the global market, dealers said.

They said there were concerns over the anticipated damage Friday’s earthquake and tsunami on Japan’s economy and the regional economies and the impact on demand for the commodity.

“Rising palm oil stocks coupled with slowing down in demand also encouraged players to trim their position this week,” a dealer said.

On Thursday, cargo surveyor Societe Generale de Surveillance reported that Malaysia’s palm oil exports for March 1-10 fell 16.6 per cent to 355,485 tonnes from 426,163 tonnes shipped during the same period last month.

Another cargo surveyor Intertek Testing Services reported that exports of palm oil products for March 1-10 fell 19 per cent to 353,542 tonnes from 437,479 tonnes shipped in the same period last month.

The Malaysian Palm Oil Board also reported that Malaysia’s February palm oil stocks rose 4.24 per cent to 1,478,793 tonnes from a revised 1,418,663 tonnes in January.

Interband Group of Companies Senior Trader Jim Teh said the CPO prices were expected to consolidate after the recent rally.

He expects CPO to trade between RM3,000 and RM3,200 per tonne next week.

On Friday-to-Friday basis, March 2011 contract fell RM289 to RM3,420 per tonne and April 2011 dropped RM290 to RM3,399 per tonne.

May 2011 eased RM296 to RM3,364 per tonne and June 2011 declined RM285 to RM3,345 per tonne.

Turnover declined to 105,608 lots from 131,125 lots last Friday while open interest decreased to 96,456 contracts from 99,966 contracts previously.

On the physical palm oil market March South ended RM210 lower at RM3,500 per tonne. — Bernama

Source : Business Times

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