Saturday, July 14, 2012

Options Crude Palm Oil Futures (OCPO)

Dear Fellow Traders,

Grab the opportunity to make more profit....


Calls: C OCPO Puts: P OCPO

European Options

Crude Palm Oil futures contract (FCPO)

One Crude Palm Oil futures contract (of a specified month) of 25 metric tons (MT)

RM0.50 per MT (RM12.50 per contract)

Trading shall be conducted for put and call options with striking prices in integral multiples of RM50 per MT. There will be at least 11 strike prices (five are in-the-money, one is at-themoney and five are out-of-the-money).

Monthly (list the third, fourth, fifth and sixth forward months) then alternate months going out 24 months of the FCPO contract. The first spot option contract month will be trading the 3rd month FCPO contract.

There will be no daily price limits.

The spot options will cease trading at 6.00 pm on the 10th day of every month, or the preceding business day if the 10th is a nonbusiness day. The futures position will be delivered at end-of-day process and will be available for trading on the next day.

In the absence of contrary instructions delivered to the Clearing House, an option that is in-the money at expiration shall be automatically exercised. Exercise results in a long 3rd month FCPO position, which corresponds with the option’s contract month for a call buyer or a put seller, and a short 3rd month FCPO position for a put buyer or a call seller.

Unexercised Crude Palm Oil futures options shall expire at 6.00 pm on the last day of trading.

First trading session: Malaysian time: 10.30 am to 12.30 pm  Second trading session: Malaysian time: 3.00 pm to 6.00 pm

10,000 futures equivalent contracts net long or net short for any single month.
15,000 futures equivalent contracts for all contract months combined.
*Speculative Position Limits are combined together with the FCPO contract.

Sunday, July 8, 2012

Weekly Crude Palm Oil Report July 8 2012

Crude palm oil futures (FCPO) on Bursa Malaysia Derivatives ended the week higher due to the weather concerns in the US and the continuous rising demand for palm oil ahead of the fasting month in Muslim countries.

The benchmark FCPO September contract surged RM110 or 3.64 per cent to close at RM3,130 per tonne on Friday from RM3,020 per tonne last Friday.

The trading range for the week was from RM3,046 to RM3,183.

Total volume traded for the week amounted to 149,052 contracts, up 40,568 contracts from the previous week.

The open interest as at Thursday increased to 107,399 contracts from 94,587 contracts the previous Thursday.

The persistent hot and dry weather in the US scorched crops in the key producing regions especially the corn crop area with the expectation of limited rainfall in the coming weeks.

The temperature in some of the areas reached the triple digit degrees Fahrenheit with excessive heat that persisted until Saturday.

However, there will be a break for the hot and dry weather pattern today with the temperature is expected to decrease about 15 to 20 degrees Fahrenheit, easing a little bit stress on the crops.

Some weather forecasters indicated that the outlook for the 11 to 15 days period would turn even hotter with limited rains.

There would be some showers over the next five days but it would mostly hit the northwestern part of the Midwest.

The US Department of Agriculture (USDA) released its weekly crop progress report on Monday saying that 48 per cent of corn crop was in good to excellent condition, declining from 56 per cent the previous week due to persistent hot and dry weather condition in US while soybean crop was 45 per cent in good to excellent condition, reducing from 53 per cent the previous week.

Cargo surveyor ITS released the palm oil export figures for the full month of June last Saturday at 1,449,280 tonnes, a rise of 4.86 per cent while another surveyor SGS on Monday at 1,463,864 tonnes, an increase of 9.75 per cent from the same period last month.

The demand from the top importing countries like China and India coupled with the Muslim countries like Pakistan and the Middle East was expected to remain strong in July ahead of the coming festive seasons.
A Reuters poll revealed on Friday that Malaysian palm oil stocks in June were expected to reduce 2.2 per cent to 1.73 million tonnes.

Meanwhile, the palm oil exports were estimated to increase 4.3 per cent to 1.46 million tonnes while the production would rise 7.7 per cent to 1.49 million tonnes.

Technical View
The benchmark September contract extended its rally this week due to the weather concern in US but vulnerable for profit taking when the price approached the resistance of RM3,193 and EMA200 line.
Palm oil prices were expected to take a break next week while waiting for the rains development in the US before the price starts to move again.

Resistance was pegged at RM3,193 and RM3,270 while support was set at RM3,030 and RM2,970.

Major fundamental news this coming week
MPOB’s monthly supplydemand report on July 10, Malaysian export data for July 1 to July 10 by ITS and SGS on July 10 and USDA’s monthly supply-demand report on July 11.

Courtesy of OPF