Crude palm oil (CPO) futures prices on Bursa Malaysia Derivatives may trade higher next week as demand for the commodity is expected to spike ahead of Ramadan, dealers said.
They said demand for cooking oil would increase during the fasting month, which would start in the second week of August.
A dealer said given the low stock, this would help push the price higher.
The Malaysian Palm Oil Board said yesterday, June stocks fell by 7.1 per cent to a 10-month low of 1.45 million tonnes from the previous month while exports rose 1.44 million tonnes with demand coming from India and China.
Societe Generale de Surveillance said palm oil exports for the first 15 days in July rose by 16.4 per cent to 708,384 tonnes and Interlek Testing Service said exports during the same period jumped 11.3 per cent to 668,573 tonnes.
OSK, in its research note earlier last week, said it would maintain a conservative CPO price assumption at RM2,250 per tonne for 2010 and 2011.
"We suspect that should the current CPO price be sustained, we may see a downward revision in average price assumption, which is between RM2,400 and RM2,500," it said.
August 2010 rose by RM149 to close the week at RM2,493 per tonne compared with RM2,344 last Friday, September jumped RM170 to RM2,470 from RM2,300 previously and October increased by RM162 to RM2,449 from RM2,287 last Friday.
Total turnover for the week rose to 96,347 lots from 70,931 lots last week.
Open positions fell to 69,473 contracts from 72,569 previously.
For the physical market, July South rose by RM80 to RM2,510 from RM2,430 per tonne from last Friday. -- Bernama
