CPO Price Level Still Sustainable

The current level of the crude palm oil (CPO) futures prices of between

RM3,200 and RM3,400 per tonne is still sustainable and likely to be

maintained in the near-term, said a dealer.

“For the moment, based on the current market situation, the

resistance level is still sustainable. I don’t think it will go down,”

he added.

He also explained that given the current buying momentum, the price

still has room to increase, saying, volume is generally low and

therefore there are no signs of congestion in the market.

He also said the CPO price uptrend was boosted by the low CPO

output and that of soyoil as well, due to adverse weather conditions and

effects of the recovering global economy.

Cargo surveyor, Intertek Testing Services on Thursday said exports rose

18.9 per cent during the Nov 1-25 period compared with the same period

in October.

Meanwhile, Societe General de Surveillance said exports advanced

24.9 per cent from the previous month, thanks to sustained demand,

especially from China.

“Heavy rain in some parts of Malaysia is likely to delay

harvesting of the crop. Concerns over decreasing stocks and rising

exports also weighed in on prices,” it added.

On a Friday-to-Friday basis, the December 2010 contract rose RM23

to RM3,360 per tonne while the January 2011 contract declined RM44 to

RM3,306 per tonne.

February 2011 slipped RM52 to RM3,274 per tonne and March 2011 dropped RM74 to RM3,243 per tonne.

Volume for the week fell to 99,615 lots from 115,253 lots

previously while the open position rose to 79,077 contracts on Friday

from 75,676 contracts previously.

As for the physical market, the CPO for December shipment was traded

higher at RM3,360 per tonne on Friday versus the RM3,350 per tonne

previously. — Bernam

Source : Business Times
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