‘Yo-Yo Mode’ Expected On CPO Futures Trade Next Week

Crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives is likely to trade in yo-yo mode next week as traders await the Malaysian Palm Oil Board’s report for January 2023 production and exports during the mid-week.

Interband Group senior palm oil trader Jim Teh said as most analysts are expecting higher stocks, lower export figures and slower demand in Malaysia and Indonesia, prices for the commodity may move up and down.

“International buyers will have more say when and where to buy due to the high inventory. Besides, next week is also a holiday-shortened week, thus there will be less buying and volume will drop.

“Furthermore, some traders are just about to start operations after the long Chinese New Year celebrations,” Teh told Bernama.

He said the commodity is expected to trade between RM3,300 per tonne and RM3,500 per tonne.

Meanwhile, palm oil trader David Ng expects the market to trade with an upward bias next week, between the range of RM3,500 per tonne and RM4,000 per tonne.

For the shortened-trading week that just ended, Malaysian CPO futures were mixed and influenced by bargain hunting, weaker export anticipation and lack of demand

On a weekly basis, February 2023 fell RM149 to RM3,725 per tonne, March 2023 was RM66 weaker at RM3,833 per tonne, April 2023 eased RM51 to RM3,851 per tonne, May 2023 subtracted RM41 to RM3,862 per tonne, June 2023 decreased RM30 to RM3,864 per tonne and July 2023 edged RM19 lower to RM3,856 per tonne.

Total weekly volume expanded to 224,673 lots from 154,453 lots, while open interest edged down to 168,241 contracts from 174,782 contracts at the end of last week.

The physical CPO price for February South was RM120 easier at RM3,800 per tonne.

The Malaysian futures market was closed on Wednesday, February 1, 2023, for the Federal Territory Day holiday.

It will also be closed on Monday, February 6, 2023, as a replacement holiday for Thaipusam which falls on Sunday, February 5, 2023.

The market resumes on Tuesday, February 7, 2023.

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