KUALA LUMPUR (Oct 6): The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives continued its upward momentum to close at a new all-time high, in line with the lower output and weaker ringgit.

The benchmark palm oil contract for December 2021 soared RM155 to RM4,872 a tonne.

Singapore-based Palm Oil Analytics’ owner and co-founder Dr Sathia Varqa told Bernama that this marked the fourth time the benchmark month hit a record high since May 12 as the palm oil market rode on the back of lower September 2021 supplies, reflected by the Malaysian Palm Oil Association (MPOA) data released at midday today.

MPOA revealed that CPO production for September 2021 declined 1.44% to 1.68 million tonnes compared with August 2021.

Sathia said the weaker ringgit also supported the higher prices and made the commodity more attractive to foreign buyers.

At 6pm, the local note eased to 4.1825/1845 versus the greenback from Tuesday’s closing of 4.1785/1795.

Commenting on the CPO price for October 2021 which rose RM92 to RM5,067 a tonne, Sathia said the historic high price for the front month made local refiners fork out hefty prices to secure upstream CPO.

“Fundamentally, CPO prices cannot be so high; it’s technical support and externals that are holding prices up so high for now,” he added.

At the close, the CPO futures contract for November 2021 surged RM130 to RM4,985 a tonne, January 2022 increased RM131 to RM4,777 a tonne, February 2022 lifted RM130 to RM4,688 a tonne, and March 2022 jumped RM123 to RM4,558 a tonne.

Total volume dropped to 63,219 lots from 82,367 lots on Tuesday, while open interest decreased to 245,176 contracts from 256,608 contracts previously.

The physical CPO price for October South was RM100 higher at RM5,060 a tonne.

Source : The Edge markets