CPO futures close higher on solid export data

Palm fruit seeds are seen on the ground of an oil palm plantation at Sepang, Selangor, Malaysia on Monday, Sept 6, 2021. (Photo by Suhaimi Yusuf/The Edge)

Palm fruit seeds are seen on the ground of an oil palm plantation at Sepang, Selangor, Malaysia on Monday, Sept 6, 2021. (Photo by Suhaimi Yusuf/The Edge)

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KUALA LUMPUR (Sept 6): The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives ended higher today, as export performance showed strength based on numbers by cargo surveyors, a dealer said.

According to cargo surveyor Intertek Testing Services’ data, Malaysia's exports for period between Sept 1 and Sept 5 rose by 88.73%month-on-month (m-o-m) to 344,650 tonnes, from 182,615 tonnes in the same period last month, said palm oil trader David Ng.

“However, the expectation of higher output continues to put pressure on prices,” he told Bernama.

He located support at RM4,220 per tonne and resistance at RM4,400 per tonne.

Meanwhile, Singapore-based Palm Oil Analytics owner and co-founder Dr Sathia Varqa said CPO futures traded hesitantly higher today but failed to hold onto the gains, ahead of the Malaysian Palm Oil Board (MPOB) data due on Friday.

“Lower production from Southern Peninsula Palm Oil Millers' Association (SPPOMA) offered much of the support for higher prices together with firm performance in China's Dalian Commodity Exchange, but gains were not retained,” he said.

The SPPOMA data revealed that Sept 1-5 production was lower by 24.74%, compared to the same period last month.

At the close, CPO futures contract for September 2021 inched up RM2 to RM4,552 a tonne, October 2021 gained RM6 to RM4,435 a tonne, November 2021 rose RM21 to RM4,331, and December 2021 increased RM27 to RM4,238 a tonne.

Meanwhile, January 2022 improved by RM34 to RM4,159 a tonne and February 2022 was up RM43 to RM4,085 a tonne. 

Total volume weakened to 50,726 lots from Friday’s 68,180 lots, while opening lower to 240,827 contracts from 256,759 contracts previously. 

The physical CPO price for September South improved by RM40 to RM4,620 a tonne, from RRM4,580 a tonne last Friday.