Palmoil HQ Strong demand set to boost palm oil futures

Crude palm oil (CPO) futures on Bursa Malaysia Derivatives are likely to be higher next due to increasing demand amid tight supply, said dealers.

“There is strong demand from India at the moment, which will likely result in higher CPO prices in the near term,” one of the dealers said.

Meanwhile, the growing concern over crude oil price, which is lingering at US$65 per barrel, will also boost the take-up for biodiesel and offer an advantage to CPO price, she said.

She said the price of CPO was also expected to move in line with soyoil price on the Chicago Board of Trade (CBOT).

During the week, the market was traded lower due to a lack of participation, profit-taking and the absence of fresh leads.

On a Friday-to-Friday basis, June 2009 was up RM30 to RM2,615 per tonne, July 2009 increased RM17 to RM2,570 per tonne, August 2009 increased RM39 to RM2,560 per tonne and September 2009 went up RM59 to RM2,549.

The week’s turnover stood at 16,098 lots, declining from last week’s 19,827 lots while open position narrowed to 78,971 contracts on Friday from 79,380 contracts at the end of last week.

On the physical market, May South was traded lower at RM2,600 per tonne on Friday versus RM2,620 per tonne, previously.

There was no transaction in the crude palm kernel oil futures market throughout the week.