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Crude palm oil (CPO) futures on Bursa Malaysia Derivatives are projected to experience a volatile trading environment next week, with market experts forecasting prices to fluctuate within a range of RM4,100 to RM4,250 per tonne. This outlook comes amid growing concerns regarding elevated stock levels that are weighing on market sentiment.
According to Jim Teh, a senior palm oil trader at Interband Group of Companies, Malaysia's total palm oil inventories climbed to 3.51 million tonnes in September, marking the highest stockpile recorded this year. Teh noted that if prices reach the projected levels, physical buyers from key markets including India, China, Pakistan, and the Middle East are likely to move toward clearing some of their existing inventory.
David Ng, a proprietary trader at Iceberg X Sdn Bhd, suggested that while the market may trade cautiously, there is a slight positive bias supported by firm global energy markets. However, he cautioned that any upside movement is likely to be capped by expectations of increased palm oil production throughout October, which could further pad inventory levels.
In terms of weekly performance, the November 2026 contract dropped by RM138 to RM4,449 per tonne, while the December 2026 and January 2027 contracts saw declines of RM145 and RM137, respectively. Further out on the curve, contracts for February through April 2027 also retreated, with price drops ranging from RM141 to RM167 per tonne.
Market activity saw a significant decrease, with weekly trading volume shrinking to 363,163 lots from the previous week's 538,346 lots. Open interest also dipped slightly to 337,166 contracts. In the physical market, the price for November South CPO was quoted RM90 lower at RM4,460 per tonne.
Source: BERNAMA