Malaysian crude palm oil futures hit a fresh high on Tuesday, moving closer to the key RM4,500 resistance level on record crude and soyoil.
The benchmark July contract on the Bursa Malaysia Derivatives Exchange rose to a record RM4,491 (US$1,403) a tonne.
Global vegetable oil prices often track energy markets as rapeseed and soybean oils are converted into biodiesel in Europe and America. This puts more pressure on palm oil to satisfy food demand as shipments to Europe, China and other regions rise. Jakarta's plan to hike export tax from 10% to 15% for palm oil and the further strenghtening of ringgit further helps to alleviate the crude palm oil prices to a record level.
The continued upward trend of commodities prices will push the inflation higher and it seems that it will not go down any time soon.
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