The crude palm oil futures contract on Bursa Malaysia Derivatives ended higher on Tuesday (Sept 20), thanks to stronger exports which lifted the market, coupled with the strength in soybean oil trading on the Chicago Board of Trade.
Figures compiled by cargo surveyor Intertek Testing Service revealed that exports of palm oil for Sept 1-20 rose 30.58% to 950, 827 tonnes, from the 728,165 tonnes recorded in the same period a month ago.
Another cargo surveyor Amspec said exports were up by 39.35% to 866,984 tonnes, against 622,180 tonnes previously.
Palm oil trader David Ng said he located the support level at RM3,500 per tonne and resistance at RM4,000 per tonne.
Separately, MIDF Research, via its note on Tuesday, raised the 2022 growth projection for the country’s exports and imports to 22.4% and 29.5% respectively.
It said there were signs of diversification to new markets for palm oil exports.
“We expect the relatively lower prices [to] limit the sector’s exports growth, but possible diversification to new markets may help support palm oil exports,” it said.
The research house said for the agriculture sector, although the sector’s export growth accelerated to +47.9% year-on-year, thanks to the lower base, the monthly decline in exports of palm oil and palm oil-based agriculture products can be explained by the price correction and supply constraints.
At the close on Tuesday, the CPO futures contracts for the spot month of October 2022 rose RM70 to RM3,676 per tonne, November 2022 was up RM48 to RM3,702 per tonne, December 2022added RM37 to RM3,737 per tonne, and January 2023 was RM35 higher by RM3,768 per tonne.
February 2023 improved RM32 to RM3,809 per tonne, and March 2023 inched up RM35 to RM3,848 per tonne.
Total volume increased to 93,585 lots from 74,304 lots on Monday (Sept 19), while open interest narrowed to 262,125 contracts from 276,288 contracts previously.
The physical CPO price for September South was maintained at RM3,750 per tonne.
Source: The Edge Market