Crude palm oil (CPO) futures on Bursa Malaysia Derivatives are expected
to be firmer on expectation of upbeat forecasts at an industry
conference next week, dealers said.
Bursa Malaysia will host the
annual Palm and Lauric Oils Conference and Exhibition: Price Outlook
2010/2011 on March 9 and 10 in Kuala Lumpur.
“All prominent
market experts will assemble next week to share views on the development
and challenges of the palm oil industry, including the price outlook
for this year,” said one of the dealers.
Industry regulator, the
Malaysian Palm Oil Board, is also due to release the figures on palm oil
exports, output and stocks for February on Wednesday.
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At the same time, cargo surveyors Intertek Testing Services and Societe
Generale de Surveillance are scheduled to release their forecasts for
palm oil exports for the first 10 days of February.
Concerns over
lower output could also pull up the prices, said another dealer.
“Palm
oil stocks are expected to decline as the low production cycle, which
started in December, will continue until April and the market is going
to be supportive,” he said.
According to market talks, February’s
palm oil stocks could be between 1.85 million and 1.9 million tonnes,
lower than January’s stock figures of two million tonnes.
For
next week, most traders are predicting an upward bias in rangebound
trade, with the support level at RM2,600 per tonne and resistance at
RM2,720 per tonne.
The local CPO market will also track closely
the performance of soyoil prices on the Chicago Board of Trade,
according to the dealers.
Palm oil and soybean are widely used
for edible oil worldwide.
On a Friday-to-Friday basis, the CPO
futures contract for March 2010 delivery climbed by RM81 to RM2,676 per
tonne while April 2010 went up RM87 to RM2,677 per tonne.
CPO
futures for May 2010 contract rose by RM75 to RM2,670 per tonne and June
2010 was RM85 higher at RM2,664 per tonne.
The week’s turnover
stood at 81,079 lots, up from last week’s 56,619 lots, while open
position declined to 81,079 contracts on Friday from 82,981 contracts at
the end of last week.
On the physical market, March South was
traded higher at RM2,680 per tonne on Friday compared with RM2,605 per
tonne previously. — Bernama
Source : Business Times
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