KUALA LUMPUR: The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives is likely to trade higher next week, ranging between RM2,350 and RM2,500 per tonne, on better market outlook amid lower stockpiles.
Independent trader David Ng said the positive trade data for June 2020 released by the Malaysian Palm Oil Board (MPOB), coupled with the anticipation of better figures for the first 10 days of July, would boost demand for the golden fruit next week.
"The overall report (by MPOB) is positive, with lower stockpiles and higher exports reported.
"For next week, the market will trade with an upward bias on prospects of stronger exports and expectation of lower stocks for July 1-10," he told Bernama.
On Friday, the Malaysian Palm Oil Board (MPOB) announced that total palm oil stock has decreased by 6.33 per cent month-on-month (m-o-m) to 1.9 million tonnes in June 2020, from 2.03 million tonnes recorded in May 2020.
The CPO inventory increased 3.56 per cent m-o-m to 1.03 million tonnes during the month under review, but production rose 14.19 per cent m-o-m to 1.89 million tonnes from 1.65 million tonnes previously.
In a statement today, the industrial regulator said palm oil exports rose 24.91 per cent m-o-m in June 2020 to 1.71 million tonnes from 1.37 million tonnes previously.
For the week just ended, CPO was traded in a volatile market, tracking the performance of its rival soyabean, crude oil prices, the ringgit’s movement against the US dollar, and trade data.
On a Friday-to-Friday basis, the CPO futures contract for July 2020 rose RM46 to RM2,467 per tonne, August 2020 surged RM66 to RM2,456 per tonne, September 2020 jumped RM54 to RM2,412 per tonne and October 2020 added RM36 to 2,384 per tonne.
Weekly volume declined tp 215,356 lots from 228,676 lots last Friday while open interest widened to 249,900 contracts from 238,796 contracts.
On the physical market, July South rose RM35 to RM2,475 per tonne. - Bernama
Did you find this article insightful?
100% readers found this article insightful