​cpo Futures End Higher Amid Lower Stockpile

By Nurunnasihah Ahmad Rashid

KUALA LUMPUR, March 11 (Bernama) -- The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives ended higher on Monday amid a lower CPO stockpile in the country leading to a tight supply in the market, said analysts.

Quoting the Malaysian Palm Oil Board (MPOB) on its latest industry performance report for February 2024, palm oil trader David Ng said the country’s CPO stocks hit a seven-month low since July 2023 to 1.92 million tonnes from 2.02 million tonnes in January 2024.

He told Bernama that the futures gains were also supported by stronger soybean oil prices.

“We see support at RM4,000 a tonne and resistance at RM4,250 a tonne,” he said.

According to the MPOB, the CPO inventory decreased by 2.85 per cent to 1.03 million tonnes in February versus 1.06 million tonnes recorded in January.

It said palm oil exports slipped by 24.75 per cent to 1.02 million tonnes in February from 1.35 million tonnes in January, but oleochemical exports increased by 0.77 per cent to 255,163 tonnes in February from 253,204 tonnes previously. 

Another analyst said the market is now focusing on the March export and production numbers as well as the resumption of demand ahead of the Ramadan month starting tomorrow.

CGS International Futures Malaysia Sdn Bhd said in a note today that CPO has been underpinned by positive sentiment about tight supplies during an industry conference in Kuala Lumpur last week, whereby the markets were bullish on concerns about stagnating production in Southeast Asia.

“Market participants are expecting higher exports from Malaysia during the first 10 days of March after four months of declines.

“Still, palm oil’s premium and high prices could cap export demand,” it said.

At the close, the spot month March 2024 and April 2024 contract were RM27 higher at RM4,208 a tonne and RM4,206 a tonne respectively, while May 2024 gained RM37 to RM4,131 a tonne and June 2024 rose RM47 to RM4,029 a tonne.

Meanwhile, July 2024 was RM51 higher to RM3,921 a tonne and August 2024 increased RM49 to RM3,847 a tonne.

Total volume decreased to 64,330 lots from 89,225 lots last Friday while open interest fell to 274,991 contracts from 276,573 contracts previously. 

The physical CPO price for March South was up by RM10 to RM4,230 per tonne from RM4,220 per tonne last Friday.

-- BERNAMA