KUALA LUMPUR: Crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives is likely to trade between the RM3,450 and RM3,550 per tonne range against a cautious backdrop this week.
Interband group of companies senior palm oil trader Jim Teh said the market is expected to remain quiet with local and international traders back from their long Christmas and year-end break.
“I do not foresee much volume being traded next (this) week. Demand at the beginning of the year is always slow,” he told Bernama.
Palm oil trader David Ng is also expecting the market to trade range bound amid mixed sentiments as a weaker export pace is weighing down palm oil prices despite weaker output expectation.
Meanwhile, Mumbai-based Sunvin Group commodity research head Anilkumar Bagani said the Malaysian Palm Oil Board is expecting the oil palm industry to stage a stronger performance next year in anticipation of rising demand for vegetable oils in sync with the world’s increasing population.
“The anticipated stronger performance of Malaysia’s oil palm industry in 2024 will be attributed to several factors which include higher production, better palm oil prices and stronger demand from key export destinations,” he added.
For the week just ended, CPO futures traded mostly higher, except on Thursday, on the expectation of weaker output in the coming weeks.
At the close, January 2024 shed RM15 to RM3,662 per tonne, February 2024 fell RM24 to RM3,695, while March 2024 and April 2024 decreased RM17 each to RM3,721 and RM3,718 per tonne, respectively.
May 2024 slid RM5 to RM3,708 per tonne and June 2024 eased RM4 to RM3,677 per tonne.
Total weekly volume declined to 159,990 lots from 239,804 in the preceding week, while open interest narrowed to 214,074 contracts from 217,514 previously.
The physical CPO price for December South slid RM20 to RM3,700 per tonne on Friday from RM3,720 a week earlier.
The market will be closed on Jan 1 for the New Year holiday. Operations will resume the following day. — BERNAMA
