KUALA LUMPUR, Jan 2 (Bernama) -- The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives closed higher today underpinned by potential demand from India, which has revised the import duties on CPO and refined palm oil effective Jan 1.
New Delhi has cut import duties on CPO and refined palm oil from Southeast Asian countries. The duty on CPO was lowered to 37.5 per cent from 40 per cent while the tax on refined palm oil was cut to 45 per cent from 50 per cent.
Singapore-based Palm Oil Analytics owner and co-founder Dr Sathia Varqa said the the tax revision would make palm oil more competitive and would have a positive impact on CPO prices.
“Given India is the largest palm buyer in the world, the announcement had a significant positive impact on CPO prices on the first day of trading in 2020,” he told Bernama.
Meanwhile, palm oil trader David Ng said the uptrend in the market was also supported by weaker output and lower inventory following the seasonal monsoon period.
“We locate the next support at RM3,080 per tonne and resistance at RM3,180,” he said.
At the close, the CPO futures contract for January 2020 increased RM84 to RM3,125 per tonne, while February 2020 expanded RM75 to RM3,141, March 2020 was RM78 stronger at RM3,130 and April 2020 was RM76 higher at RM3,107 per tonne.
Volume jumped to 48,760 lots from Tuesday's 32,979 lots, while open interest went up to 276,876 contracts from 264,787 contracts previously.
On the physical market, January south ended at RM3,110 per tonne today.
Palm oil, CPO, MPOB, import duty, India