Commodity Trading Tips for Crude Palm Oil by KediaCommodity

Ajay Kumar Kedia 11 June 2014

Crude-Palm-Oil CPO settled down -0.2% at 511.4 as a weak trend in the global markets weighed on prices. Malaysia palm oil production surged 6.5% on month in May while exports jumped 10.7% on month, Dow Jones reported citing Malaysian Palm Oil Board (MPOB) data. Malaysia, world's second-biggest palm oil producer, crude palm oil output in Malaysia rose to 1.65 million tons in May compared to 1.55 million tons in March, the report showed. Exports from Malaysia gained 1.4 million tons in May compared to 1.26 million in April, the report said. Palm oil inventories in Malaysia climbed 4.2% to 1.84 million tons in May compared to 1.76 million tons a month ago. Meanwhile, Intertek a private surveyor showed Malaysia palm oil exports dropped 0.3% on month to 390,729 tons in Jun 1-10 compared to 391,856 tons for the same period a month ago. Palm oil stocks in Malaysia likely edged up for a third straight month in May to touch their highest since the end of January, a survey showed, as a rise in production outstripped export demand for the tropical oil. Stockpiles in Malaysia, the world's second-largest producer, have grown continuously since the beginning of March due to higher crude palm oil output amid poor global demand. A further rise in inventories would add pressure on benchmark palm prices that are already down nearly 10 percent this year. May's palm output was seen rising 7.1 percent to 1.67 million tonnes, according to the survey. Technically market is under fresh selling as market has witnessed gain in open interest by 3.2% to settled at 1967 while prices down -1 rupee, now CPO is getting support at 509.9 and below same could see a test of 508.3 level, And resistance is now likely to be seen at 513.3, a move above could see prices testing 515.1.