Palm oil set for worst week in 11 months on weak demand concerns


At midday, CPO for third month futures fell RM47 to RM3,480.

KUALA LUMPUR: Palm oil futures are headed for their steepest weekly drop in 11 months on concerns that demand from key buyers will dissipate as Malaysia reported a slump in export data.

Prices in Kuala Lumpur are down 9.1% so far this week, the most since the week ending Feb. 28. Palm, used in everything from cookies to cosmetics and biofuel, plummeted 4.5% on Thursday and briefly climbed early Friday, before reversing

gains to stretch losses to a fifth straight day.

At midday, CPO for third month futures fell RM47 to RM3,480.

Futures initially bounced back alongside the rebound in overnight Chicago soybean oil and “roaring” crude oil futures, but succumbed to weak export demand which is denting sentiment, according to Gnanasekar Thiagarajan, head of trading and hedging strategies at Kaleesuwari Intercontinental.

Malaysia’s palm oil exports tumbled 42% to 426,276 tons in the first half of January, compared to a month ago, according to AmSpec Agri. That’s a steeper decline from the 35% drop in the Jan. 1-10 period.

Still, palm oil’s underlying bullish trend remains undisturbed, Thiagarajan said.

The tropical oil is set to have its best annual showing in a decade even as the coronavirus pandemic rages on, with futures likely to average 3,200 ringgit a ton in 2021 from 2,700 ringgit last year, according to a Bloomberg survey. - Bloomberg

Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 18
Cxense type: free
User access status: 3

crude palm oil , demand , key buyers

   

Did you find this article insightful?

Yes
No

94% readers found this article insightful

Next In Business News

Tenaga underpins KLCI’s advance, gloves under pressure
Quick take: MSM continue uptrend, adding 13%
ANZ writes down AmBank stake after 1MDB settlement
Quick take: Oil and gas shares up in active trade
Trading ideas: TNB, FGV, MMC, Guan Chong, MAHB, Maxis, Alliance, AMMB
RHB sets higher earnings estimate for IHH
Tremendous earnings growth for Kelington in FY21, says Kenanga
Summary of business news from Feb 22 to 28
Asian stocks bounce as bond market calms
Australian home prices race at fastest pace in 18 years

Stories You'll Enjoy


Vouchers