Local commodity prices advanced yesterday, with the benchmark crude palm oil (CPO) futures rising above the RM4,000-a-tonne level for the first time, while tin jumped for a fifth consecutive record session on a buoyant overseas market.
Analysts said the commodities market was benefiting from unprecedented interest from investment funds seeking better returns and shying away from the lacklustre bonds and equities.
Crude oil in New York hit a new high of US$103 per barrel before pulling back yesterday. Gold also climbed to an all-time high of US$978 an ounce yesterday as investors sought to shield their money against inflation.
While prices of precious metals like gold and silver rallied, metals such as copper and tin also strengthened despite worries consumption would falter if the world economy slowed drastically.
On the home front, the CPO futures contract for May delivery rose RM155 to RM4,005 a tonne.
The contract hit a peak of RM4,013 yesterday as it tracked the record performance of rival soybean in Chicago's futures market overnight.
The palm oil price in Malaysia – the global benchmark – has doubled over the past one year as the bullish outlook for the commodity fuelled heavy interest from speculative funds.
At an industry conference in Kuala Lumpur earlier this week, experts forecast CPO could reach as high as RM4,500 per tonne in the coming months as the production of competing vegetable oils may fall this year.
China and India, the two biggest consumers of world vegetable oils, are projected to increase their palm oil purchases to make up for anticipated shortfalls in their own production of soybean and rapeseed.
Both soybean and rapeseed can be crushed to make cooking oil or biodiesel.
Palm oil is a cheaper substitute for soyoil and rapeseed oil.
Meanwhile, the weaker US dollar against major currencies has benefited investors holding non-US dollar denominated plays such as the ringgit-based CPO futures contract.
The ringgit was traded to a high of 3.1848 against the greenback yesterday – its best level in a decade. It stood at 3.362 to the dollar three months ago.
Despite the gains by CPO and the local currency, stock prices on Bursa Malaysia continued to weaken for a second day in a row.
The KL Composite Index fell 10.87 points to 1,357.4, the lowest since Jan 22 this year.
Analysts said the commodities market was benefiting from unprecedented interest from investment funds seeking better returns and shying away from the lacklustre bonds and equities.
Crude oil in New York hit a new high of US$103 per barrel before pulling back yesterday. Gold also climbed to an all-time high of US$978 an ounce yesterday as investors sought to shield their money against inflation.
While prices of precious metals like gold and silver rallied, metals such as copper and tin also strengthened despite worries consumption would falter if the world economy slowed drastically.
On the home front, the CPO futures contract for May delivery rose RM155 to RM4,005 a tonne.
The contract hit a peak of RM4,013 yesterday as it tracked the record performance of rival soybean in Chicago's futures market overnight.
The palm oil price in Malaysia – the global benchmark – has doubled over the past one year as the bullish outlook for the commodity fuelled heavy interest from speculative funds.
At an industry conference in Kuala Lumpur earlier this week, experts forecast CPO could reach as high as RM4,500 per tonne in the coming months as the production of competing vegetable oils may fall this year.
China and India, the two biggest consumers of world vegetable oils, are projected to increase their palm oil purchases to make up for anticipated shortfalls in their own production of soybean and rapeseed.
Both soybean and rapeseed can be crushed to make cooking oil or biodiesel.
Palm oil is a cheaper substitute for soyoil and rapeseed oil.
Meanwhile, the weaker US dollar against major currencies has benefited investors holding non-US dollar denominated plays such as the ringgit-based CPO futures contract.
The ringgit was traded to a high of 3.1848 against the greenback yesterday – its best level in a decade. It stood at 3.362 to the dollar three months ago.
Despite the gains by CPO and the local currency, stock prices on Bursa Malaysia continued to weaken for a second day in a row.
The KL Composite Index fell 10.87 points to 1,357.4, the lowest since Jan 22 this year.
