Crude Palm Oil On MCX Settled Down By -1.13% At 508.5


 
Crude palm Oil on MCX settled down by -1.13% at 508.5 tracking weakness in spot demand and overseas prices on forecasts of rising output. Data from industry regulator showed that output in March rose 16.3% on month. Moreover, narrowing spread between soybeans and palm could be pressuring the palm oil prices. There is expectation of higher stock levels of edible oil in the country as oilseed crushing is going on in full swing. Moreover, government lowered the base import price of CPO by $22 to $725 per tonnes for 2 nd half of April, their 5th consecutive fortnightly decline in base import price.Export of palm oil from Malaysia is forecast to increase marginally by 3.1% on year in Oct-Sep 2016-17 to 17.15 mln tn, despite production expected to jump by 9.7% to 19.5 mln tn, the US Department of Agriculture, said in a recent report. The relative stagnation of Malaysia's palm oil export has been due to stiff competition from the world's biggest palm oil exporter Indonesia and other edible oils such as soybean, sunflower, canola and rapeseed oils. Indonesia, the world's largest producer of palm oil, has aggressively entered the China and India markets by lowering prices of its palm oil.

Over the years, Indonesia gained market share in China and India at the expense of Malaysia, the agency said in the report. Technically market is under long liquidation as market has witnessed drop in open interest by -2.84% to settled at 5194 while prices down -5.8 rupees, now CPO is getting support at 506 and below same could see a test of 503.6 level, And resistance is now likely to be seen at 511.4, a move above could see prices testing 514.4. 
 
 
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