KUALA LUMPUR, Oct 22 ― The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives ended lower today, tracking the weaker Dalian Commodity Exchange soybean oil prices after Chinese authorities clamped down on speculative activities, especially in the agriculture market.
Palm oil trader David Ng said market sentiment was affected by the fall in soybean oil prices.
“We locate support at RM4,820 a tonne and resistance at RM5,050 a tonne,” he told Bernama.
Meanwhile, Singapore-based Palm Oil Analytics’ owner and co-founder Dr Sathia Varqa said CPO futures extended its losses from yesterday, but the losses were much smaller by market close.
“CPO was in long liquidation triggered by sharp sell-off in soybean oil on the Dalian exchange as traders baked-in the correction from the energy market after the Chinese government signaled (coal mines) to stabilise coal supply and moderate the excessive rise in energy prices,” he said.
He said the Malaysian Palm Oil Association (MPOA) October 1-20 production data released after market close showed a decline of 3.34 per cent compared to the same period last month. This implies a bullish outlook with production at the low end of expectation, offering the prospect of price recovery next week.
At the close, the CPO futures contract for November 2021 decreased RM21 to RM5,188 a tonne and December 2021 fell RM38 to RM5,036 a tonne.
January 2022 and February 2022 were both down by RM44 at RM4,924 and RM4,825 a tonne, respectively, while March 2022 eased RM43 to RM4,716 a tonne and April 2022 dipped RM39 to RM4,595 a tonne.
Total volume slipped to 73,052 lots from 80,761 lots on Thursday while open interest narrowed to 260,656 contracts from 274,001 contracts previously.
The physical CPO price for November South was RM10 higher at RM5,230 a tonne. ― Bernama
