FCPO Related News

Crude palm oil futures on Malaysia’s derivatives exchange ended higher Friday, reflecting technically driven buying following a steep decline over the past two weeks. However, the upside is likely to be limited by rising palm oil stockpiles in Malaysia, the world’s No. 2 producer, trade participants said. The benchmark December contract at Bursa Malaysia Derivatives ended 2.7% higher at 2,415 ringgit a metric ton after moving in a range of MYR2,376-MYR2,448 a ton.

Palm oil stockpiles in Malaysia probably rose to a record 2.43 million-2.50 million metric tons in September, reflecting seasonally higher production and tepid export demand. The Malaysian Palm Oil Board, the industry regulator, is scheduled to issue September crop data Wednesday. The surge in stockpiles comes as global vegetable oil supplies are rising, thanks in part to a fast-paced soybean harvest in the U.S. Midwest, just as slowing economic growth in major consumer countries is cutting into demand, which could drag palm oil prices to a three-year low in coming weeks.

"Palm oil prices will likely trade with a downward bias next week, as investors are likely to liquidate positions following the Malaysian cabinet’s decision to delay a decision on the proposed crude palm oil export tax cut," a commodities trader at a Singapore-based firm said. The cabinet Friday said it needed more time to study a proposal to cut the export tax on CPO to 8%-10% from the current 23%, an aid to Commodities Minister Bernard Dompok said. The official said the government would make a decision soon.

[Dow Jones Newswire]

“The demand undertone is fairly good,” said Vijay Mehta, a director at Commodity Links Pte. in Singapore. “If the market stabilizes, buyers are willing to jump in. There is good buying interest from India and Bangladesh.” (Bloomberg)

Today’s Support and Resistance for benchmark December  is located around 2,378 and 2,485 respectively.