CPO Futures likely to trade on a slightly upward bias next week

KUALA LUMPUR: The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives is expected to trade on a slightly upward bias next week, said palm oil trader David Ng.

He said this is because of a weaker-than-expected output owing to the recent labour shortage.

“We expect prices to trade between RM3,600 and RM4,100 next week,” he told Bernama.

Meanwhile, Interband Group of Companies senior palm oil trader Jim Teh expects the CPO market to trade between RM3,000 and RM3,100 per tonne next week amid high level of inventories and fears over a global recession.

He said it is hoped that the lower prices would benefit consumers and help ease the rising food inflation.

For the trading week just ended, Malaysian CPO futures were mostly lower influenced by the Chicago bean oil market, high level inventories in Malaysia and Indonesia, fluctuating crude oil prices and Indonesia’s move to scrap its export levy on palm oil.

On a Friday-to-Friday basis, spot month August 2022 rose RM147 to RM3,707 a tonne, September 2022 was RM116 higher at RM3,701 a tonne, October 2022 was up RM90 to RM3,720 a tonne and November 2022 increased RM73 to RM3,751 a tonne.December 2022 gained RM53 to RM3,800 a tonne and January 2023 added RM41 to RM3,850 per tonne.

Total volume increased to 360,695 lots from 270,789 lots in the previous week, while open interest rose to 264,060 contracts from 222,879 contracts previously.The physical CPO price for August South remained unchanged at RM3,800 a tonne from July South.

— BERNAMA