KUALA LUMPUR, Oct 16 — The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives closed higher for the second consecutive day today following news that Malaysia would work with India to address the palm oil issue.
“The news has, more or less, cleared the uncertainties and convinced market participants that the recent news on India’s palm oil import curbs was merely media speculation,” said a dealer today.
Earlier today, Prime Minister Tun Dr Mahathir Mohamad said that the government would work diplomatically if India does decide to restrict its imports of Malaysian palm oil.
However, the government has yet to receive any official communication from the Indian government on the issue.
“We have not received anything officially. This is the reaction from the business community. Hence, we cannot react to their personal decisions.
“If the (Indian) government launched a boycott or something like that, then we will have to work diplomatically or reduce the kind of action that they have taken,” Dr Mahathir told a media conference here today.
News that India was considering restricting its palm oil imports from Malaysia emerged last Friday after Reuters reported that the Indian government was displeased with Malaysia following Dr Mahathir’s statement at the United Nations last month that India had “invaded and occupied” Jammu and Kashmir, and asked New Delhi to work with Pakistan to resolve the issue.
At the close, CPO Futures for new spot month November 2019 jumped RM51 to RM2,189 per tonne, December 2019 rose RM46 to RM2,219 per tonne, January 2020 was RM39 higher at RM2,252 per tonne and February 2020 added RM34 to RM2,289 per tonne.
Volume advanced to 52,159 lots from 39,924 lots on Tuesday and open interest improved to 245,759 contracts from 232,838 contracts yesterday.
On the physical market, October South climbed RM70 to RM2,180 per tonne.