Crude palm oil (CPO) futures contracts on Bursa Malaysia Derivatives closed marginally higher on Wednesday (Aug 17), in line with gains in soybean oil prices, a dealer said.
Palm oil trader David Ng said higher soybean oil futures in the Chicago Board of Trade (CBOT), coupled with improving crude oil prices, supported local CPO futures.
“Hence, we locate support at RM3,900 a tonne and resistance at RM4,500 a tonne,” he told Bernama.
Meanwhile, Mumbai-based Sunvin Group commodity research head Anilkumar Bagani said CPO futures opened a gap lower on Wednesday, extending Tuesday’s weakness, following sharply lower CBOT soybean oil and crude oil futures overnight.
However, the reduction in Malaysian palm oil export tax for September saw CPO prices recovering quickly and going into positive territory at the close.
“Malaysia kept palm oil export tax for September unchanged at 8%, revising the palm oil reference price to RM3907.51, from RM5257.91 per tonne in August.
“But net payable export tax has gone down tentatively to RM312.60 per tonne (US$70) for September, from RM420.63 per tonne in August (US$94.61). The 8% export duty is the highest cap, as prices are in the highest tax bracket above RM3,450 per tonne,” he said.
At the close, CPO futures contracts for spot months September 2022 improved RM10 to RM4,166 a tonne, while October 2022 and February 2023 increased RM6 each to RM4,176 a tonne and RM4,293 a tonne respectively.
November 2022 was RM11 higher at RM4,193 a tonne, December 2022 added RM14 at RM4,214 a tonne, and January 2023 edged up RM1 to RM4,247 a tonne.
However, total volume narrowed to 47,353 lots from 54,298 lots on Tuesday, while open interest decreased to 230,089 from 237,696 contracts previously.
Physical CPO price for August South was RM50 lower at RM4,250 a tonne.
Source: The Edge Market