Crude palm oil futures on Malaysia’s derivatives exchange rose to their highest level in three years in a holiday-shortened trade Wednesday on the back of logistical problems in the key palm oil state of Johor that could limit availability of oils for export.
The benchmark April contract on the Bursa Malaysia Derivatives exchange ended 2.3% higher at MYR3,895 a metric ton after rising as high as MYR3,910/ton, a level not seen since March 2008.
Palm oil extended gains after floods in major oil palm growing regions damaged roads, with transportation from mills in Segamat and Kota Tinggi regions in Johor state grinding to a halt.
Disruption to harvesting rounds at several oil palm estates will reduce supply in February as less palm fruit is collected.
"The output in February will be sharply lower, due to the shorter month and disruptive weather. I'm expecting a drop of 15%-20%" from January's level, said a trading executive at a Kuala Lumpur-based commodities brokerage.
Traders and analysts estimate January's output to have fallen 15% on month to 1.05 million tons.
Concerns about a slowdown in exports of soybeans and soy products from Argentina amid an ongoing port strike may support palm oil prices.
"Palm oil prices may hit MYR4,000/ton when the market reopens Monday due to ongoing issues in Malaysia and Argentina," said an analyst at a Singapore-based investment bank.
The BMD will be closed Thursday and Friday due to Lunar New Year holidays.
Chicago Board of Trade March soyoil was trading 18 points higher at 58.90 cents a pound in screen trade at 0441 GMT.
CME Group's dollar-denominated crude palm oil contract for April delivery was trading $24.25 higher at $1,279.75/ton at 0449 GMT.
Indonesia Commodities & Derivative Exchange rupiah-denominated April palm oil contract was last trading at IDR11,415/ton, up 2.6%.
Open interest on the BMD was 89,398 lots, versus 92,083 lots Monday. One lot is equivalent to 25 tons.
A total of 11,600 lots of CPO were traded versus 19,085 lots Monday.
Jumat, 04 Februari 2011
PalmOil HQ Crude CPO Hits 3-Year High On Malaysia Floods, Supply Disruption
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