CPO Price Increase Impedes Strengthening Malaysian Ringgit Rate
By : Abraham Sihombing And Aldo Bella Putra | Friday, September 08 2017 - 22:00 IWST
INDUSTRY.co.id - Jakarta - The strengthening of the Malaysian ringgit exchange rate of 1.74% in the last four days reduced the interest of foreign investors to crude palm oil (CPO). This resulted in CPO price on Friday (08/09/2017) opened at a lower level than the trading session the previous day.
In fact, the price of CPO on Thursday (07/09/2017) had risen sharply thanks to a positive sentiment on the EU decision related to anti-dumping biodiesel policy. In addition, the stability of soybean oil performance helped sustain CPO prices.
Currently, investors are putting off Malaysia CPO export data for the period of 1-10 September 2017 from ITS and SGS, as well as CPO production data to be published by Malaysia Palm Oil Board (MPOB) on September 11, 2017.
Malaysia's CPO exports in August 2017 are forecast to rise 1.6% to 1.42 million ton compared to July 2017. The increase in exports is believed to offset rising production, as demand from India and China is expected to remain high ahead of the festive holiday in the coming months.
Technically, according to analysts of commodity products PT Monex Investindo, CPO price is still likely to rise to test the level of 2,820 ringgit per ton before penetrating the next psychological resistance point at 2900 levels.
However, the strengthening of the Malaysian ringgit rate that limits the CPO price hike could depress the Malaysian palm commodity, even pressing it to a level of 2,700 per ton. If this happens, then the price of CPO Malaysia potentially continues to decline to 2620 ringgit per ton. (Abraham Sihombing)