CPO on MCX settled up 0.92% at 547.5 on short covering after prices dropped amid expectation of higher output. Recovery in yields in major growing region of Southern peninsular Malaysia also with higher soybean production estimate in South America weighed on the prices. In addition to that, subdued demand also kept oil prices under pressure. Malaysia's Feb 1-20 palm oil exports decline by 0.8% to 733,288 tons compared to same period a month ago, data published by Intertek showed. As per Malaysian custom dept, March'17 Crude Palm oil export duty has been raised to 8% from 7.5% a month ago. Palm oil imports fell for the third consecutive month by 11.56 per cent to 608,762 tonnes in January, on account of good domestic oilseeds production and better availability of edible oils, industry body Solvent Extractors Association (SEA) said. India, the world’s leading vegetable oil buyer, had imported 688,393 tonnes palm oil in January 2015. The country’s total vegetable oil imports fell by 19 per cent to 1.24 million tonnes (mt) in January this year from 1.26 mt in the year-ago period. “Import has reduced due to good Kharif oilseeds crop and better domestic availability of edible oils and utilisation of stock. Currency crunch due to demonetisation has slowed down the purchases by end consumers also affected the demand and import to some extent,” SEA said in a statement. Technically market is under short covering as market has witnessed drop in open interest by -16.23% to settled at 1012 while prices up 5 rupees, now CPO is getting support at 544.2 and below same could see a test of
540.8 level, And resistance is now likely to be seen at 550, a move above could see prices testing 552.4.

Trading Ideas:

# CPO trading range for the day is 540.8-552.4.

# Crude palm oil prices ended with gains on short covering after prices dropped amid expectation of higher output.

# Malaysia's Feb 1-20 palm oil exports decline by 0.8% to 733,288 tons compared to same period a month ago, data published by Intertek showed.

# As per Malaysian custom dept, March'17 Crude Palm oil export duty has been raised to 8% from 7.5% a month ago.

Crude palm oil prices in spot market dropped by 4.10 rupees and settled at 545.90 rupees.