Business Times Palm oil futures post 11th weekly gains

CPO FUTURES

Palm oil futures in Malaysia gained yesterday, posting an eleventh weekly advance, amid concern over tight vegetable oil supply.

“There’s still price support because June is the lowest production month,” Ben Santoso, an oilseed analyst at DBSVickers Securities Singapore, said. “I don’t think it’s sustainable after June.”

Palm oil for July delivery rose 0.2 per cent to RM2,685 (US$763) a metric ton on the Malaysia Derivatives Exchange. Futures reached RM2,798 on May 4, the highest in almost nine months after stockpiles fell 13 per cent to 1.36 million tons in March.

Oil palms in Indonesia and Malaysia, which account for 90 per cent of global production, typically produce 55 per cent of their oil in the second half of the year.

Analysts are watching for April production data after signs palms recovered from tree stress with output gaining by 7.4 per cent in March, according to Malaysian Palm Oil Board data released on April 11.

They are also awaiting official export data, after contradictory figures from independent cargo surveyors.

Malaysia’s palm oil exports fell 4.5 per cent to 1.17 million tons in April compared with March, said Societe Generale de Surveillance. That compared with an estimated 2.5 per cent gain to 1.19 million tons in April, Intertek said.