CPO futures may face selling pressure

Crude palm oil (CPO) futures prices on Bursa Malaysia Derivatives may come under selling pressure next week.

“Sentiment could turn bearish as production begins to pick up after the wintering season.

“Production is rising and that’s prompting fears of rising stock levels,” said a dealer, adding that output was expected to rise by 20 per cent but exports only by a meagre one per cent.

She said investors are awaiting the release of March’s production data by the Malaysian Palm Oil Board while Societe Generale de Surveillance and Intertek Testing Services are expected to do the same for the first ten days of April, both on Monday.

“Despite the outlook, we expects demand to remain intact,” she added.

On a Friday-to-Friday basis, April 2011 rose RM41 to RM3,434 per tonne, May 2011 gained RM49 to RM3,409 per tonne, June 2011 improved RM59 to RM3,399 per tonne and July 2011 added RM57 to RM3,390 per tonne.

The weekly turnover rose to 111,816 lots, from last Friday’s 107,821 lots, while open interest advanced to 98,009 contracts, from 92,346 contracts, last week.

On the physical market, April South was RM40 higher at RM3,450 per tonne. — Bernama

Source: Business Times

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