By Durratul Ain Ahmad Fuad
KUALA LUMPUR, July 2 (Bernama) -- The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives hit an 11-week high on Tuesday for the current spot month, said an analyst.
Fastmarkets senior analyst Sathia Varqa said this was fueled by solid rises in related vegetable oils, lower palm oil production outlook and an active cash market action.
At the close today, the CPO futures contract for spot month July 2024 jumped RM116 to RM4,140 a tonne.
He said Societe Generale de Surveillance reported that June exports were up 3.58 per cent, recovering from a drop of 4.31 per cent in the June 1-25 period, while other cargo surveyors reported a drop of 12 per cent to 15 per cent for June.
“While export estimates are mixed, production is likely to be lower which is supporting the rally in CPO futures. UOB Kay Hian estimates show June production to be down three to seven per cent.
“Market participants will be keenly watching for the Malaysian Palm Oil Association June production data,” he told Bernama.
Meanwhile, palm oil trader David Ng said CPO futures rallied above RM4,000 per tonne as expectations of weak production and strong Chicago Board of Trade soybean oil prices helped prices to close higher for the day.
“I think CPO prices would likely stay above RM4,000 per tonne this week given the strength in the soybean oil market as well as the possibility of lower stock in the country.
“We see immediate price support level at RM4,000 per tonne and next resistance to be at RM4,150 per tonne,” he said.
Ng said there will be the Malaysian Palm Oil Board June supply and demand previews out on Friday this week as well.
Meanwhile, the CPO futures contract for August 2024 climbed RM107 to RM4,105 a tonne, September 2024 gained RM110 to RM4,089 a tonne, October 2024 contract went up RM106 to RM4,071 a tonne, November 2024 added RM99 to RM4,058 a tonne and December 2024 increased by RM93 at RM4,056 a tonne.
Total trading volume expanded to 78,058 lots from Monday’s 59,294 lots, while open interest improved to 218,410 contracts from the previous 210,848 contracts.
The physical CPO price for July South was RM100 higher at RM4,150 per tonne.
-- BERNAMA
