CRUDE palm oil futures closed little changed yesterday, giving up more than 1 per cent in late trade on profit-taking, amid caution about production prospects for this month, traders said. Lower production is key to keeping August’s closing stocks low after the 25-days exports data showed shipments dropped as much as 10.5 per cent to 1,000,846 tonnes, from 1,117,848 tonnes shipped between July 1 and 25. “There were talks that palm oil production in the southern plantations as of Aug. 25 was down by around 9 per cent. That actually caused the market to shoot up after lunch but eventually we saw some profit-taking,” said a trader.
He said what triggered the late selling is speculation that nationwide output for August could still go up as weather conditions have improved in other regions, with production from Sabah likely on the rise. “Based on our rough calculation, we should see August ending stock moving up to close to 1.4 million tonnes again. That is capping the market upside,” the trader said. The benchmark November palm oil futures on the Bursa Malaysia Derivatives Exchange edged up RM2, or 0.1 per cent to RM2,357 per tonne, after going as high as RM2,385. Overall volume was 15,048 lots of 25 tonnes each. In the physical market, palm oil for August and September delivery was traded at RM2,460-RM2,475 in the southern region and at RM2,450-RM2,470 in the central regions.]]>