FCPO Related News

Crude palm oil futures on Malaysia’s derivatives exchange ended higher Thursday, holding on to gains after data on China’s economy met expectations. Expectations for export demand to rise during the October-December quarter supported market sentiment as well, market participants said. The benchmark January contract at Bursa Malaysia Derivatives ended 1% higher at 2,496 ringgit a metric ton after moving in a MYR2,475-MYR2,508 range.

OSK   Research   says   that   buying   will   be   steady   today   and could drive prices toward MYR2,500-MYR2,525/ton  and  notes "  a  breach  past  these  levels  should  ease  any doubt of lingering price weakness. "The market now expects palm oil exporters, particularly those with refineries overseas, to export as much oil as possible before the duty-free CPO export quota is discontinued at the end of the year," a trading executive at Kuala Lumpur-based OSK Investment Bank said. Higher exports could help draw down stock levels that rose to an all-time high of 2.48 million tons in September due to seasonally higher production.

China’s third-quarter growth data, a key data point to assess the state of the region’s largest economy, came out at 7.4%, in line with a median forecast of 14 economist surveyed by Dow Jones Newswires. Open interest on the BMD was 151,863 lots versus 174,059 lots Wednesday. One lot is equivalent to 25 tons. A total of 34,274 lots of CPO were traded versus 44,600 lots Wednesday.     [Dow Jones Newswire]

Palm oil futures also rose on gains in the U.S. soy complex, traders said. Soybean futures extended gains in Asian trade on Thursday, driven by bargain hunting after prices slid this week to their lowest since late June. U.S. soybean futures edged higher on Friday, rising for a fourth straight session and on track for the first weekly gain in more than a month as strong demand and slow selling by farmers supported prices.  U.S. soybean prices rose on Thursday for a third straight day as farmers were slow to sell amid a waning harvest for the crop and cocoa rebounded on less grinding of the commodity that is used for confections and beverages.

Palm oil futures, which have lost 21 percent so far this year, also gained support from shortcovering by some investors ahead of the Muslim holiday of Eid al-Adha next week. "The market should continue to go higher," said a trader with a local commodities brokerage. "They are expecting some floods because there's going to be rainy days ahead." He added, "I'm expecting some short covering to take place either now or next week -- next week it will be Hari Raya Haji," referring to the Muslim holiday.

In a bullish signal for palm oil, crude oil held above $113 a barrel as Chinese economic data signalled stabilisation in the economy of the world's second-largest oil consumer while concern over supplies in the Middle East provided support.

Today’s Support and Resistance for benchmark January contract is located around 2,440 and 2525 respectively.