Spot RBD Palmolein To Trade Higher Next Week

MUMBAI (Commoditiescontrol)-

Malaysian Palm Oil Futures

Malaysian palm oil futures traded higher on Friday ahead of the release of official MPOB data for September, charting a fourth straight day of gains and finishing the week stronger after two consecutive weeks of decline.

The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange was up 0.4 percent at 2,730 ringgit ($644.48) a tonne at the close of trade. The contract has gained 1.3 percent this week, hitting a one-week high on Thursday. Traded volumes stood at 42,505 lots of 25 tonnes each on Friday evening.

Palm was supported by lower-than-expected production," said a trader.

Another trader had earlier said the market was quiet and lacked direction pending the release of monthly data from the Malaysian Palm Oil Board

Exports, however, were seen strong and production is not coming up as fast as expected.

A Reuters poll showed September end-stocks likely rose 3.2 percent from a month earlier to 2 million tonnes, their highest since February 2016.

Output is seen rising to 1.84 million tonnes, the strongest in nearly two years, while exports are forecast to gain 7.8 percent to 1.60 million tonnes.

Domestic RBD Palmolein Scenario



RBD palmoelin traded steady at Rs 590/10kg at kandla port on limited demand and also CIF price of the commodity ruled steady at $715/tonne.

Sellers are reluctant to sell the commodity at current price level as they are anticipating that demand of RBD palmolein will increase in upcoming Diwali Festival which starts on 19th October.

Further the stock of RBD palmolein at ports is sufficient so importers have stopped bulk purchases as the import of RBD palmolein is costlier by Rs 18/10kg which is likely to create supply shortage in local markets.

RBD palmolein forward month CIF prices are not trading at discount which also indicates that RBD palmolein prices to trade firm in near term.

Demand of RBD palmolein in domestic market is hand to mouth as most of the wholesale and retail traders have covered their near term requirement.