Crude palm oil (CPO) futures on Bursa Malaysia Derivatives are expected to be volatile next week, with impact from the upcoming US Department of Agriculture (USDA) report, dealers said.
“The report pertaining to the global crop supply and demand will impact the CPO market and it is still hard to determine the market direction for next week,” said one of the dealers.
He said while the October month is the peak harvest season, there is still potential demand in the market.
“The upcoming USDA report will definitely have a big impact on the vegetable oil sector,” the dealer said.
Traders are conservative about the report’s impact and are taking profit this week ahead of the report, according to an analyst.
He expects a big range for CPO price next week with a support level at RM2,650 per tonne and a resistance level of RM2,850 per tonne.
During the week, CPO prices were higher in line with the prices of other commodities.
On a Friday-to-Friday basis, October 2010 dropped RM3 to RM2,749 per tonne while November 2010 added RM55 to RM2,784 per tonne, December 2010 increased RM27 to RM2,760 per tonne and January 2011 rose RM13 to RM2,754.
The week’s turnover stood at 73,363 lots, down from 89,219 lots last week, while open position rose to 71,632 contracts from 68,718 contracts previously.
On the physical market, October South was traded higher at RM2,780 per tonne compared with RM2,750 per tonne last Friday. – Bernama
Source: Business Times