Palm | Kelapa Sawit

CPO futures ended lower after trading in a rather mix market sentiment. Earlier Benchmark Jan09 open RM18 higher at 1695 and climbed to hit intra day high of 1714 following a strong overnight closed at CBOT soy complex and higher NYMEX crude oil. It then eased off due to lack of follow through buying support and closed at 1685 by mid day. A mix of several supportive and negative news has influenced CPO prices today. First is the Malaysia government considering removing windfall tax after CPO prices declined sharply since the tax was imposed, but then Malaysia postponed a special meeting to discuss on measures to boost palm oil prices, this made traders a bit disappointed as they are waiting for some good news from it. During afternoon session, a leading analyst James Fry commented that palm oil might drop to RM1200 if Brent crude falls to $55. Meanwhile Iran’s oil minister said OPEC might cut oil output by 2-2.5m barrels per day. In the later afternoon session, CPO encounters some long liquidation activities, coupled with easier e-CBOT. Benchmark Jan09 fall to the day low of 1639 before it settled at 1652. Daily volume remains good, with 11,435 contracts changed hands.