BERNAMA – Crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives extended Saturday’s losses to end lower yesterday, following weakness in the Chicago Board of Trade soybean oil futures, said a dealer.
Mumbai-based Sunvin Group commodity research head Anilkumar Bagani said weakness in the Dalian Commodity Exchange refined, bleached, and deodorised palm olein futures during Asia’s trading hours also continued to push prices down.
“There was not much activity seen on the sellers’ side despite CPO futures falling sharply for the past two days as there is a negative refining margin at both Malaysia and Indonesia at the moment.
“It was also the reason that Indonesian sellers were offering CPO at around USD30-USD40 per tonne discount against Malaysian counterparts,” he told Bernama.
He said for the January 1-5 period, Malaysia’s palm oil export, at 71,100 tonnes, fell by 68 per cent from the December 1-5 period.
“The Malaysian Palm Oil Association (MPOA) and UOB Kay Hian production estimates suggest that Malaysian palm oil production during December stood at 4.42 per cent and in the range of one to five per cent lower from November estimates.
“The Malaysian Palm Oil Board (MPOB) December supply and demand previews are out and almost everyone is in consensus that Malaysian palm oil production dropped by three per cent in November to 1.63 million tonnes and exports above 1.5 million tonnes. Meanwhile, end stocks eased to 2.26 per cent to 2.17 million tonnes,” he said.
Palm oil trader David Ng said CPO futures ended lower as concern over weak demand and rising COVID-19 cases in China.
“We locate support at MYR4,000 per tonne and resistance at MYR4,400 per tonne,” he said.
Meanwhile, Singapore-based Palm Oil Analytics owner and co-founder Sathia Varqa said a mix of weak demand outlook from China and cautious trading ahead of key data next week kept the market lower.
At the close, January 2023 decreased MYR99 to MYR3,981 per tonne, February 2023 lost MYR45 to MYR4,038 per tonne, March 2023 was MYR38 lower at RM4,052 per tonne and April 2023 slipped by MYR32 to MYR4,049 per tonne,
Meanwhile, both May 2023 and June 2023 eased by MYR27 to MYR4,040 per tonne and MYR4,012 per tonne respectively.
Total volume declined to 48,553 lots from 59,347 lots on Thursday, while open interest improved to 199,856 contacts from 198,939 contracts previously.
The physical CPO price for January South slipped by MYR10 to MYR4,070 per tonne.
