CPO futures to rise on global demand

Crude palm oil (CPO) futures prices on Bursa Malaysia Derivatives are likely to stay firm next week on bullish outlook for the commodity, dealers said.

Dorab Mistry, whose forecasts are keenly watched, had earlier said that price of CPO could rise to RM2,800 to RM3,000 per tonne by the end of the first quarter of 2010 on higher global demand.

With increasing global demand, the price of palm oil is also expected to be higher than other vegetable oils.

One market player said the bullish outlook will encourage traders to take position in the first week of January, adding that the price of CPO could move between RM2,600 and RM2,800 per tonne next week.

However, the Malaysian market performance will also largely depend on external factors such as soyoil prices on the Chicago Board of Trade and Dalian market, as well as crude oil price, he added.

"Next week is the beginning of 2010 and most traders are awaiting new set of data before taking any position. Market players are optimistic that export is still healthy with output still at low level," he said.

The Malaysian Palm Oil Board is scheduled to release palm oil data next week.

The market was traded mostly higher throughout the holiday-shortened week.

It was closed on Friday for the New Year holiday.

On Thursday-to-Thursday basis, CPO futures for January 2010 rose RM82 to RM2,578 a tonne, February 2010 increased RM83 to RM2,620 a tonne, March 2010 gained RM109 to RM2,663 a tonne and April 2010 added RM106 to RM2,660 a tonne.

Turnover declined to 51,603 lots from 59,828 lots last week while open position was lower at 81,268 contracts from 84,589 contracts previously.

On the physical market, the newly-traded January South contract ended the week at RM2,600 per tonne -Bernama

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Traderone : Seem like all news painting positive from all angles. Well it is a good way to start the new year. Take note MACD has yet to cross signal line.