KUALA LUMPUR: The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives is expected to trade in a cautious mode next week due to the resurgence in COVID-19 cases across the globe, a dealer said.
He said the pandemic is likely to have further impact on the utilisation of the palm oil production especially in Sabah due to the rising number of cases, amid the permission by the state government to allow several plantations to operate throughout the Conditional Movement Control Order (CMCO).
Last Thursday, Sabah Local Government and Housing Minister Datuk Seri Masidi Manjun said cocoa, rubber and oil palm plantations were allowed to operate but with compliance to the standard operating procedures set by the Ministry of Health.
Meanwhile, Interband Group of Companies senior palm oil trader Jim Teh said the CPO price could edge slightly lower in range-bound trading between RM2,700 and RM2,800 per tonne levels on technical correction and profit-taking next week.
"Overall, palm oil has been at the best agriculture price and at the same time, it is also very dangerous to trade too high as the price could collapse steeply,” he told Bernama.
Singapore-based Palm Oil Analytics’ owner and co-founder Dr Sathia Varqa said the market would also focus on the full-month production and exports estimation in October, slated to be released next week.
On a Friday-to-Friday basis, the CPO futures contract for November 2020 was up RM188 to RM3,252 per tonne, December 2020 rose RM149 to RM3,177 per tonne, January 2021 climbed RM69 to RM3,011 per tonne, and February 2021 was RM50 higher at RM2,929 per tonne.
Weekly volume narrowed to 274,134 lots from 320,776 lots in the previous week, while open interest shrank to 259,678 contracts from 261,154 contracts a week earlier.
On the physical market, November South stood at RM3,280 per tonne.
The market was closed on Thursday for the Maulidur Rasul public holiday. - Bernama
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