Profit-taking likely to drag CPO futures lower this week

KUALA LUMPUR: Crude palm oil (CPO) futures on Bursa Malaysia Derivatives are expected to trade lower this week as profittaking is likely to emerge after the recent rally, despite crude oil prices remaining elevated.

Interband Group of Companies senior palm oil trader Jim Teh said CPO futures had climbed to about RM4,700 per tonne alongside crude oil prices, which reached approximately US$100 per barrel, prompting speculative buying.

However, he expects syndicate speculators to lock in gains this week, describing the market as a “yo-yo” market.

“The trading range will be between RM4,400 and RM4,500 per tonne this week,” he told Bernama.

Teh further pointed out that although physical demand from key importing countries would continue to support the market, ample palm oil inventories in Malaysia and Indonesia are expected to cap further gains.