)
Crude palm oil (CPO) price has jumped 8.5 per cent so far this month on reports of a fall in output in Malaysia due to unfavourable weather.
On the benchmark Bursa Malaysia, CPO for near month delivery shot up to trade currently at 2,306 ringgit a tonne on Wednesday from 2,125.50 ringgit a tonne towards the end of January. After hitting a five-and-a-half year low in September last year at 1,900 ringgit a tonne, the commodity bounced back. Since then, however, CPO price has risen almost a quarter.
The CPO price spurt, however, may reduce margins of user industries including soap and detergent manufacturers.
“CPO bounced back in the last few days on reports of potential improvement in biodiesel demand from Indonesia and a decline in output from Malaysia. Its outlook still remains bullish with CPO price to move up at least by 10 per cent in near term,” said Ajay Kedia, managing director of Kedia Commodity Comtrade, a city based commodity broking firm.
Meanwhile, Malaysian CPO production declined 15 per cent to 1.16 million tonnes in January 2015 from 1.4 million tonnes in December 2014.
