The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives is likely to trade with a slight upward bias next week due to weaker production and a smaller stockpile.
Palm oil trader David Ng said the CPO stockpile is likely to fall for another month.
“We expect the market to trade between RM3,750 a tonne and RM3,920 a tonne,” he said.
Meanwhile, Mumbai-based Sunvin Group commodity research head Anilkumar Bagani said Malaysia’s palm oil domestic consumption is expected to remain robust ahead of Ramadan.
He opined that by end-February, palm oil inventories are estimated to fall below the psychological level of two million tonnes.
For this week, CPO futures were traded mostly higher due to concern over the lower stock level in the country.
On a weekly basis, the new spot month March 2024 contract eased RM4 to RM3,910 a tonne, April 2024 dropped RM27 to RM3,857 a tonne, May 2024 went down RM21 to RM3,809 a tonne, and June 2024 fell RM23 to RM3,745 a tonne.
July 2024 was RM29 lower at RM3,690 a tonne while August 2024 declined RM42 to RM3,643 a tonne.
The total weekly volume shrank to 272,517 lots from 310,938 lots in the previous week while open interest widened to 227,927 contracts from 218,313 contracts previously.
The physical CPO price for February South stood at RM3,980 per tonne, up RM10 from RM3,970 per tonne last week.
