Commodities Roundup: CPO futures gain on rising oil price
Business Times
Tuesday - April 29, 2008
CPO FUTURES
Crude palm oil (CPO) futures prices on Bursa Malaysia Derivatives closed mostly higher yesterday, influenced by the increasing world oil price, a trader said.
Palm oil is an alternative biofuel source which makes it a much sought after commodity amid the rising oil price.
The benchmark third-month July ’08 contract rose RM91 to RM3,510 per tonne from RM3,419 per tonne last Friday.
The trader also said he expected CPO prices to go further up due to the weakening US dollar, which has led to a commodity price rally as the weaker US dollar translates into “cheaper” prices in consuming countries.
“Commodities, including CPO, are viewed as a good hedge against the weakening US dollar currently,” he said.
The crude oil price jumped to a near US$120 per barrel yesterday due to concern of lower output from the top oil producers.
At close, the May 2008 CPO futures contract increased RM77 to RM3,497 per tonne, June 2008 climbed RM120 to RM3,510 and Aug 2008 rose RM91 to RM3,510.
The day’s volume stood at 8,660 lots versus 6,752 lots last Friday while open interest went up to 39,036 contracts from the previous 38,288 contracts.
On the physical market, April South was higher at RM3,510 per tonne from last Friday’s RM3,410 per tonne.
