Lunar New Year, China's CPO Demand Predicted to Increase Rapidly

By : Abraham Sihombing And Aldo Bella Putra | Thursday, January 04 2018 - 22:00 IWST

Kebun Kelapa Sawit (Ist)
Kebun Kelapa Sawit (Ist)

INDUSTRY.co.id - Jakarta - The price of crude palm oil (crude palm oil / CPO) of Malaysia has an opportunity to increase in trading Thursday (04/01/2018). Malaysia's CPO price increase was boosted by increased demand from China and other vegetable oil price increases.

On Wednesday (03/01/2018), Malaysia's CPO price on the Malaysian Commodity Exchange rose 2.9% to 2,606 ringgit per ton. That is the highest increase over the past nine months.

The increase is in anticipation of the CPO price increase that occurred at Chicago Board of Trade of 0.9% for March 2018 delivery contract. In addition, the price of soybean oil yesterday for May 2018 delivery also increased 0.2%.

"CPO demand from China will usually rise ahead of Lunar New Year next month. Therefore, the vegetable oil traders in China are starting to anticipate the increase in demand since the beginning of this year in order to increase the price," said Faisyal, an analyst at PT Monex Investindo Futures commodities in Jakarta, Thursday (04/01/2018).

In addition, Faisyal said, futures market traders in Kuala Lumpur believe the global vegetable oil market is currently reacting to anticipated increases in exports in the future.

"That's because Malaysia's CPO exports have increased between 6-9% in December 2017. Meanwhile, the export increase is predicted to continue throughout January 2018 due to increased demand from China," Faisyal said.

As is known, China is the second largest CPO importer in the world after India. Traders in China will increase their CPO reserves ahead of Lunar New Year to anticipate an increase in demand for cooking.

Until now, the price of Malaysian CPO is in the range of 2,480-2,630 ringgit per ton. In the near future, CPO price is expected to continue to strengthen to break the level of 2585 ringgit per ton before reaching its resistance point at 2,630 ringgit per ton.

"However, the price of new CPO is likely to decline if the price has been reduced to 2,520 ringgit per ton, before finally dwindling at its support point at 2,480 ringgit per ton," Faisyal added. (Abraham Sihombing)

News Comment

Today's Industry

GoTo is a blend of Gojek and Tokopedia. (Photo: republika.co.id)

Jumat, 02 Desember 2022 - 22:48 WIB

Lockup Sentiment Only Temporarily, GOTO Owns Chance to Rebound

Shares of PT Goto Gojek Tokopedia Tbk (GOTO), which experienced selling pressure after end of the lock up period on November 30, 2022, are considered by a number of market participants to provide…

GoTo is a blend of Gojek and Tokopedia. (Photo: republika.co.id)

Rabu, 30 November 2022 - 19:35 WIB

GoPay's Dominance Drives Consistency in GOTO's Financial Business Segment Growth

The financial services business segment, namely GoTo Financial owned by PT GoTo Gojek Tokopedia Tbk (GOTO), recorded impressive business growth consistency. This is reflected in GoPay's dominance…

The President Director of PT Honeywell Indonesia, Roy Kosashi, clarified many kind of leading technology for Indonesia’s New Capital City, in Jakarta on Tuesday (29/11/2022). (Photo: PT Honeywell Indonesia)

Rabu, 30 November 2022 - 19:28 WIB

Honeywell Ready to Support Indonesia’s New Capital City with Sustainability Technologies and Solutions

Honeywell announced today that it is Ready Now to support the Nusantara Capital Authority (OIKN) in realizing their goal of making a sustainable and smart forest city. OIKN is the government…

Gibu Mathew, Vice President and General Manager in Asia-Pacific (APAC) in Zoho Corp. (special)

Rabu, 30 November 2022 - 11:22 WIB

How to Make SaaS Work for Small and Medium-Sized Businesses

Southeast Asia's digital transformation has been impressive as the region is now poised to reach a projected digital economy worth USD360 billion by 2025. With digitalisation, the region bore…

PT Dharma Polimetal ("Dharma Group") Triputra Group automotive component manufacturing company.

Senin, 28 November 2022 - 12:15 WIB

DRMA Remains Optimistic 2023 Automotive Still Rises, Targets Sales Up 20%

PT Dharma Polimetal Tbk (“DRMA”), a listed company engaged in automotive component manufacturing business sees the prospects for the automotive business in 2023 will still remain promising.…