CPO Futures Likely To Trade With Positive Bias Next Week

By Zufazlin Baharuddin

KUALA LUMPUR, Oct 19 (Bernama) -- The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives is expected to trade with a positive bias next week amid lower output growth and stronger export pace.

Palm oil trader David Ng said the production pace has been sluggish and weaker production will likely lead to a lower overall stock level in the country, while export demand is resilient with seasonal buying from India ahead of the Diwali festival.

“We expect prices to be in the range of RM4,200 per tonne to RM4,400 per tonne next week,” he told Bernama.

Meanwhile, Fastmarkets Palm Oil Analytics senior analyst Sathia Varqa said some price correction is likely to happen next week after palm prices appear to have risen too high and too fast.

“The focus will be on Malaysia’s October 1-20 and October 1-25 exports which are expected to taper off from the October 1-15 rise following escalating cash product prices and palm sustained overvaluation to bean oil for over a month now.

“The focus will also be on Malaysia’s October 1-20 production data from the Malaysian Palm Oil Association,” he said.

For the week just ended, CPO futures were mostly traded lower, in line with the Chicago Board of Trade soybean oil futures, expectation of weaker output and declining crude oil prices.

On a Friday-to-Friday basis, the spot month November 2024 slid RM67 to RM4,318, December 2024 shed RM76 to RM4,274 and January 2025 decreased by RM60 to RM4,255.

Meanwhile, February 2025 slipped RM45 to RM4,223, March 2025 declined RM51 to RM4,189, while the new month April 2025 stood at RM4,152.

Total weekly volume improved to 511,988 lots from 470,718 in the preceding week, while open interest edged up to 258,075 contracts from 252,079 previously.

The physical CPO price for October South decreased by RM100 to RM4,380 on Friday from RM4,480 a week earlier.

-- BERNAMA