Tuesday, 18 April 2017
KUALA LUMPUR: Crude palm oil (CPO) prices on Bursa Derivatives, the global benchmark, descend deeper into a bear market over worries about global oversupply of edible oils.
The most active CPO futures contract fell RM3 to RM2,495 a tonne on Tuesday, its lowest level since August last year. The contract had fallen 21.6% from its recent high of RM3,185 a tonne on 15 December. But weaker CPO prices have not sapped investors appetite for plantation stocks.
Shares in major producers IOI Corp Bhd, Kuala Lumpur Kepong Bhd and Felda Global Ventures Holdings Bhd were up at midday, while smaller IJM Plantation Bhd slipped. The Bursa Malaysia Plantation Index, which tracks the performance plantation companies, was down about 3% from its recent one-an-half year high.
CPO production in Malaysia jumped 16% in March to 1.46 million tonnes, the first monthly increase since September last year. Inventories increased 6.5% to 1.55 million tonnes, according to data from the Malaysian Palm Oil Board. Meanwhile, palm oil stockpiles in Indonesia probably increased 22% last month as out rose 10%, according to a Bloomberg survey.
Malaysia and Indonesia together make up about 86% of the global supply. Meanwhile, rising soybean production in Brazil and record planting in the US, the world’s largest producer, are contributing to the global glut. Palm oil and soybean oil both compete for a share of the global edible oils market.
Source by: Internet