CPO futures set to trade with upward bias

KUALA LUMPUR – The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives is likely to trade with an upward bias next week on concerns about slowing output during the peak season, said trader David Ng.

He told Bernama that the weaker-than-expected output during the peak production period has caused anxiety among market participants, while higher demand from India and China due to restocking will continue to boost exports.

“Given this, the CPO futures contract will likely trade at between RM4,300 and RM4,480 per tonne.”

For the week just ended, Malaysian CPO futures ended mostly higher on concerns about lower stocks and weaker output in the coming weeks.

On a weekly basis, August rose RM114 to RM4,656 per tonne, September firmed RM130 to RM4,547 per tonne, October added RM98 to RM4,369 per tonne, November gained RM76 to RM4,230 per tonne, December increased RM63 to RM4,133 per tonne, and January 2022 went up RM54 to RM4,062 per tonne.

Weekly volume rose to 288,074 lots from 247,352 in the previous trading week, while open interest climbed to 251,276 contracts versus 247,352 previously.

The physical CPO price for July South advanced RM140 to RM4,560 a tonne yesterday. – Bernama, July 31, 2021