Crude palm oil futures on Malaysia’s derivatives exchange ended higher Monday on short-covering interest and higher soyoil futures, trade participants said.
Weak export data released today was largely ignored by the market, as CPO output is expected to fall in the coming months.
The benchmark July contract on the Bursa Malaysia Derivatives exchange ended up MYR20 up at MYR2,560 a metric ton, after trading in a range of MYR2,538-MYR2,568.
Malaysia's palm oil exports during the April 1-25 period were estimated to have fallen 15% from a month earlier to 947,304 tons, according to cargo surveyor Intertek Agri Services.
Another cargo surveyor, SGS (Malaysia) Bhd. also reported a drop in exports for the same period, estimating that Malaysia exported 1.01 million tons, down 9.9% from the first 25 days of March.
Although the data showed exports to be weak, the market rose on short covering interest. Traders said April will likely mark the start of seasonal decline in CPO output after several months of increases.
Bullish comments from analyst Dorab Mistry over the weekend also boosted sentiment. Despite a production spike in March, which saw output rising 20% on month to 1.39 million tons, CPO output in Malaysia is expected to fall for a second consecutive year to around 17.2 million tons in 2010, Mistry told participants at industry conference in Dubai.
Positive soyoil gains during Asian trading hours also helped support CPO prices.
At the end of trade on the BMD, May soyoil prices in electronic trading on the Chicago Board of Trade had risen 31 points to 39.66 cents a pound.
In the cash market, CPO for prompt shipment was offered MYR20 higher at MYR2,580/ton.
Open interest on the BMD was 68,733 lots versus 67,455 lots Friday. One lot is equivalent to 25 tons.
A total of 13,447 lots of CPO were traded versus 15,269 lots Friday.
Closing BMD Crude Palm Oil (CPO) futures prices in MYR/ton at 1000 GMT: Month Close Previous Change High Low May'10 2,575 2,561 Up 14 2,581 2,568 Jun'10 2,568 2,552 Up 16 2,577 2,550 Jul'10 2,560 2,540 Up 20 2,568 2,538 Aug'10 2,555 2,535 Up 20 2,559 2,537
-By Fawziah Selamat; Dow Jones Newswires; 65 6415 4127; fawziah.selamat@dowjones.com
(END) Dow Jones Newswires
April 26, 2010 06:50 ET (10:50 GMT)
Copyright (c) 2010 Dow Jones & Company, Inc.
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