Crude palm oil futures on Bursa Malaysia Derivatives were flat Wednesday as overall sentiment was weak due to recession fears in the U.S. while some supportive factors kept prices from falling.
Benchmark December contract ended MYR1 lower at MYR3,066 a metric ton, after trading both ways.
Soyoil futures rose during electronic trading at the Chicago Board of Trade. The December contract was up 0.3% at 55.82 cents a pound when trade on BMD ended. Meanwhile, expectations that export demand will improve as major consumer India restocks ahead of Diwali in October brought further support, trade participants said.
“Traders aren’t keen to set up risky positions amid ongoing uncertainties about the euro zone and the U.S.,” said a commodities broker in Kuala Lumpur, tipping CPO to remain between MYR3,000 and MYR3,100/ton for the rest of the month.
Other market participants said they expect CPO to slide further, toward MYR2,900/ton, as September output is widely expected to be sharply higher after a lull in August, when workers went home for Eid holidays.
Malaysia’s palm oil stocks at the end of August stood at 1.88 million tons, industry regulator the Malaysian Palm Oil Board said in a Sept. 12 report. A stock build toward or past the psychological level of 2 million tons would likely weigh on prices.
In the cash market, refined palm olein for October was offered unchanged $1,075/ton while cash CPO for prompt shipment was offered at MYR3,080/ton.
Traded volume on the BMD was 21,920 lots compared with 16,865 lots Tuesday. One lot equals 25 tons.
Open interest was 136,326 contracts compared with 136,170 contracts Tuesday.