CPO futures slump on lower demand, speculation
10 March 2008 09:36 [Source: ICIS news]
SINGAPORE (ICIS news)--Crude palm oil (CPO) futures for May delivery traded on Bursa Malaysia continued to spiral downwards on the back of similar falls in soybean oil during Monday.
Market sources attributed the downward trend to profit-taking by speculators, as well as talk that demand from China, the world’s largest vegetable oil importer, would drop as it released vegetable oil stockpiles to combat inflation.
May CPO futures rebounded off lows in the afternoon, trading at M$3,680/tonne ($1,165/tonne) at 08:11 GMT.
Prices fell as low as M$3,500/tonne earlier in the morning, a M$986/tonne drop after hitting a record high last Tuesday.
“Everybody knows that the funds are taking money now,” a downstream buyer of palm oil said, although he added that it was yet to be seen if the recent slump was sustainable.
“It [CPO prices] might have dropped by 1,000 points, but who can guarantee that prices won’t rise by another 1,000 points next week?” he said, describing the recent volatility in the global vegetables oil market.
($1 = M$3.16)
ICIS Copyright © Reed Business Information 2009
Author: Jeremiah Chan+65 6780 4359
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