Crude palm oil futures on Malaysia’s derivatives exchange ended little changed Thursday after moving both ways in volatile trade amid profit-taking and liquidation of positions ahead of the long weekend, trade participants said.
CPO futures opened up in the early session but gave up early gains, tumbling below MYR2,600 a metric ton despite assurances by the U.S. Federal Reserve chairman Ben Bernanke that interest rates may remain low for a while.
The benchmark May CPO contract on the Bursa Malaysia Derivatives ended MYR5 higher at MYR2,596 after moving in a MYR2,580-MYR2,615/ton range. The markets will be closed for a national holiday Friday.
A likely drawdown in palm inventories despite lower palm oil shipments prevented a significant fall in prices, as output is expected to be lower in February and March due to dry weather and the ongoing oil palm replanting program, traders and analysts said.
“Lower output and inventories may keep CPO futures steady at MYR2,550-MYR2,650/ton next week,” said a Kuala Lumpur-based trading executive.
Cargo surveyor Intertek Agri Services put Feb. 1-25 palm oil exports at 1.09 million tons, down 10% on month. Another surveyor, SGS (Malaysia) Bhd., estimated exports declined 8.9% to 1.10 million tons.
Cargo surveyors put palm oil shipments at 1.21 million tons for the same period in January.
In Indonesia, PT KPB Nusantara, a unit of PT Perkebunan Nusantara, said it sold 1,500 tons of CPO offered in a government auction Thursday.
But a further 500 tons remained unsold, as the bids were lower than its offer price of IDR7462 a kilogram.
In the cash market, palm olein for April/May/June traded at $795/ton, July/August/September traded at $795/ton, said a Singapore-based trading executive.
Cash CPO for prompt shipment was offered MYR5 lower at MYR2,605/ton.
Open interest on the BMD was 82,981 lots Thursday, down from 83,180 lots Wednesday. One lot is equivalent to 25 tons.
Some 17,856 lots of CPO were traded versus 11,714 lots Wednesday.
Closing BMD Crude Palm Oil (CPO) futures prices in MYR/ton at 1000 GMT: Month Close Previous Change High Low Mar 2010 2,595 2,600 Down 05 2,619 2,590 Apr 2010 2,590 2,590 Unchanged 2,620 2,589 May 2010 2,595 2,590 Up 05 2,615 2,580 Jun 2010 2,579 2,580 Down 01 2,604 2,572
-By Shie-Lynn Lim, Dow Jones Newswires; +603 2026 1233; shie-lynn.lim@dowjones.com
(END) Dow Jones Newswires
February 25, 2010 05:54 ET (10:54 GMT)
Copyright (c) 2010 Dow Jones & Company, Inc.
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