KUALA LUMPUR, Feb 25 — The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives plunged to below RM2,500 per tonne, its lowest since November 2019, dragged down by uncertain market sentiment.
Speaking to Bernama, Singapore-based Palm Oil Analytics owner and co-founder Dr Sathia Varqa said the CPO futures were unable to build strong support, with the benchmark month May 2020 eventually losing over 100 points.
“The market yielded to losses mirroring losses from the global equity and commodities markets as the Covid-19 showed no let-up in spreading far and fast across countries.
“A lockdown, a halt in movements and multiple cancellations of events are slowing down not just the economic cycle but life in general, threatening consumer spending and business environment on multiple fronts,” he said.
Varga said soybean oil priced-in losses of 3.68 per cent on the Chicago Board of Trade, while on the Dalian Commodity Exchange, soybean oil plunged by high double digits with palm olein going down by triple digits.
“February 1-25 Malaysian exports failed to build on the recovery from February 1-20, falling three to five per cent,” he said.
According to independent inspection company AmSpec Agri Malaysia, exports of Malaysian palm oil products for February 1-25 fell three per cent to 981,073 tonnes from 1,011,515 tonnes shipped during January 1-25.
At the close, the CPO futures contract for March 2020 fell RM116 to RM2,480 per tonne, April 2020 shed RM117 to RM2,450 per tonne, May 2020 slipped RM105 to RM2,438 per tonne and June 2020 dropped RM98 to RM2,430 per tonne.
Volume rose to 84,798 lots from yesterday's 60,835 lots, while open interest increased to 334,615 contracts from 309,598 contracts previously.
On the physical market, March South was RM70 lower at RM2,600 per tonne. — Bernama
