CRUDE palm oil (CPO) prices have been rising this year to attain an eight-year high despite the Covid-19 pandemic, suggesting brighter prospects for the plantation sector.
The most active CPO futures contract closed at RM3,437 last Friday. It had climbed to RM3,489 on Nov 19 after falling to a year-low of RM1,946 in May. Since then, prices have risen higher.
Spot prices breached the RM3,500 benchmark on Nov 19, rebounding from the low of RM2,030.50 on May 14, 2020.
MIDF Research Analyst Khoo Zhen Ye says the current rally in CPO prices has been premised on lower supply, as palm oil inventory levels have been declining despite now being the higher production period. A decline in soybean production in South America and in sunflower oil in the Black Sea also contributed to higher CPO prices.