Lang
KUALA LUMPUR – Crude palm oil (CPO) futures traded on Bursa Malaysia Derivatives are projected to experience a bearish bias in the coming week, primarily influenced by a downturn in global energy markets.
According to David Ng, a proprietary trader at Iceberg X Sdn Bhd, the prevailing lower crude oil prices have made conventional diesel more economical. This development diminishes the cost competitiveness of biodiesel, a fuel largely produced from palm oil, thereby reducing its market appeal. Ng commented, 'As a result, demand for palm oil as a biodiesel feedstock could weaken, putting pressure on CPO prices.'
However, Ng noted that any potential downward pressure on CPO prices is anticipated to be mitigated by the sector's recent strong export performance. He forecasted prices to fluctuate within a range of RM4,580 to RM4,750 per tonne for the upcoming week.
On a week-over-week comparison (Friday-to-Friday), most active CPO futures contracts saw declines. The August 2026 contract dropped by RM60 to settle at RM4,531 per tonne, while the September 2026 contract decreased by RM73 to RM4,604 per tonne. The October 2026 contract fell by RM79 to RM4,643 per tonne. Further declines were observed for the November 2026 contract, which dipped RM78 to RM4,675 per tonne, the December 2026 contract, losing RM75 to RM4,704 per tonne, and the January 2027 contract, slipping RM68 to RM4,732 per tonne.
Market activity also showed a contraction, with weekly trading volume plummeting to 363,441 lots from 503,068 lots in the preceding week. Open interest concurrently declined to 301,947 contracts from 306,540 contracts previously. The physical CPO price for August South also saw a reduction, decreasing by RM80 to RM4,530 per tonne.
Source: BERNAMA