.jpg "A worker shows oil palm fruits at a plantation in Kuala Selangor January 2, 2020. u00e2u20acu201d Picture by Yusof Mat Isa")
KUALA LUMPUR, June 22 — The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives ended lower today as expectations of a higher output continued to weigh on prices.
Palm oil trader David Ng said market uncertainty remained as concerns over a second wave of Covid-19 cases could hit demand.
“We locate support at RM2,400 and resistance at RM2,500 per tonne,” he told Bernama.
OCBC Bank economist Howie Lee said the US-China phase one trade deal may result in a glut of soy oil production in China due to excessive purchases of soybeans from the United States.
“Given that we expect China to remain committed to the trade deal, this may spell some bearish pressures on palm oil as we head deeper into the second half.
“The return of India as a buyer, however, would likely still result in a net neutral movement on CPO prices,” he said in a research note today.
According to cargo surveyor Intertek Testing Services, exports of Malaysian palm oil products for June 1-20 rose 57 per cent to 1.21 million tonnes from 772,145 tonnes shipped during May 1-20.
At the close, spot month July 2020 slipped RM18 to RM2,520 per tonne, August 2020 dropped RM26 to RM2,476 per tonne, September 2020 fell RM27 to RM2,445 per tonne, and October 2020 shed RM22 to RM2,430 per tonne.
Volume decreased to 38,163 lots from 43,933 lots last Friday, while open interest declined to 231,321 contracts from 236,120 contracts previously.
On the physical market, July South was unchanged at RM2,530 per tonne. — Bernama
