CPO FUTURES CLOSE HIGHER ON ANTICIPATION OF WEAKER OUTPUT GROWTH

By Muhammad Fawwaz Thaqif Nor Afandi and Abdul Hamid A Rahman

KUALA LUMPUR, Jan 12 (Bernama) -- Crude palm oil (CPO) futures on Bursa Malaysia Derivatives closed higher on Monday, driven by market anticipation of weaker output growth in the coming weeks, said a trader.

Kuala Lumpur-based proprietary trader David Ng of Iceberg X Sdn Bhd said weaker output growth expectations were the main factor to support the higher prices.

“Anticipation of reduced output in key producing regions has led to increased buying interest, helping CPO futures to gain momentum.

“The market tends to react more strongly to anticipated supply shortages rather than current inventory levels,” he said.

Ng added that although the Malaysian Palm Oil Board (MPOB) reported higher stock levels recently, market participants are expecting production to slow down because of seasonal changes and weather disruptions.

“Despite recent reports indicating a rise in stock levels, traders remain optimistic due to expected supply constraints.

“Industry observers note that despite the higher inventory data, the overall sentiment remains bullish as demand for palm oil in global markets continues to hold firm,” he added.

Technically, Ng said support is seen around RM4,000 per tonne, while resistance is expected at RM4,180, and a breach of these levels could set the tone for future price movements.

At the close, the January 2026 contract gained RM30 to RM3,980 per tonne, February 2026 increased RM49 to RM4,060 per tonne and March 2026 rose RM54 to RM4,090 per tonne.

The April 2026 contract edged up RM54 to RM4,103 per tonne, May 2026 strengthened RM54 to RM4,107 per tonne and June 2026 surged RM54 to RM4,098 per tonne.

Trading volume fell to 90,086 lots from 110,659 lots on Friday, while open interest advanced to 258,843 contracts from 255,449 contracts previously.

The physical CPO price for January South rose RM40 to RM4,050 per tonne.

-- BERNAMA