Today, CPO Price Moves in Range RM2.450-2.560 per Ton
By : Abraham Sihombing And Aldo Bella Putra | Tuesday, February 06 2018 - 21:00 IWST
Kebun Kelapa Sawit (Ist)
INDUSTRY.co.id - Jakarta - Malaysian crude palm oil (CPO) price is expected to move in the range of RM2,450 - 2,560 a ton in trading on Tuesday (06/02/2018) and tends to weaken due to the outlook for export slowdown and reserve rise.
This was disclosed by Faisyal, a research staff and futures analyst at PT Monex Investindo Futures, in Jakarta, Tuesday (06/02/2018).
On Monday (05/02/2018), CPO prices rose thanks to the depreciation of the Malaysian Ringgit (RM) exchange rate and massive buying of CPO to replenish its short covering reserves.
According to survey results of two surveyor companies, shipments of CPO from Malaysia in January 2018 are expected to fall 8% to 1.31 million tons compared to the previous month. That's because of the decline in demand from China although they want to welcome Imlek.
Chinese Lunar New Year celebrations usually encourage increased CPO demand because it is used for cooking purposes during the celebration. But because the reserves of soybean oil and olive oil are quite large, it limits Chinese imports to CPO this year.
Meanwhile, total CPO final reserves are expected to rise 0.6% to 2.75 million tons compared to the position in December 2017. According to a Reuters survey. It will boost Malaysia's CPO reserves by the end of January 2018 to the highest level since November 2015.
High reserves can push down the price of CPO, which is mostly produced by Malaysia and Indonesia. CPO can be used as raw material for producing soap and vegetable oil.
"In the future, the price of CPO can reach RM2.560 per ton. That might happen if the price can penetrate RM2.520 per tonne first. But if the price of CPO has weakened up to RM2,480, that means, the price of CPO potentially reaches the lowest point at RM2.450 per ton," Faisyal concluded. (Abraham Sihombing)