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By Durratul Ain Ahmad Fuad and Niam Seet Wei
KUALA LUMPUR, April 1 -- The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives ended sharply higher on Thursday, tracking the solid gains of the soybean oil futures on the US Chicago Board of Trade (CBOT).
“Soybean oil futures on the CBOT hit limit-up for the fifth time in the past two weeks,” Singapore-based Palm Oil Analytics’ owner and co-founder Dr Sathia Varqa told Bernama.
According to Sathia, soybean oil jumped five per cent on the second month after the United States Department of Agriculture (USDA) reported lower-than-expected soybean planting acreage, and a 31 per cent cut in soybeans quarterly stock to 1.56 billion bushels.
“Tight soybeans supply outlook for 2021-2022 from the report propelled the soft oil to rebound, spilling-over to push palm higher this morning," he said.
Although data from the Southern Peninsula Palm Oil Millers’ Association showed that palm oil productions for March 2021 increased 39 per cent from that in February 2021, Sathia said the data was eclipsed by the outperforming soybean oil prices.
Concurring with Sathia, palm oil trader David Ng said CPO futures was higher today as the stronger overnight soybean oil performance on the CBOT continued to lift sentiment in palm oil.
"We locate support at RM3,680 a tonne and resistance at RM3,800 a tonne," he said.
At the close today, the CPO futures contract for April 2021 increased RM90 to RM4,151 per tonne, May 2021 added RM131 to RM3,956 per tonne, June 2021 rose RM129 to RM3,741 per tonne, and July 2021 was RM100 higher at RM3,572 per tonne.
Total volume increased to 74,006 lots from 62,888 lots on Wednesday, while open interest rose to 266,674 contracts from 247,463 contracts previously.
The physical CPO price for April South jumped RM100 to RM4,160 per tonne.