Palm oil expected to hit RM3,600 in H1 next year (BT)

Palm oil prices can hit RM3,600 a tonne as soon as in the first half of next year, traders say, which would be their highest since 2008 as demand continues to be robust, while supply is hit by erratic weather.

"In the next six to nine months, palm oil prices should trade at around RM3,600 per tonne, if all fundamental factors remain the same," said NextView Sdn Bhd chief market strategist Benny Lee.

He attributed the increase in palm oil prices since July to a weaker US dollar and a stronger yuan.

The last time palm oil prices hit their all-time high, at RM4,486 per tonne, was in mid-2008.

Lee was presenting his take on palm oil price movement at the International Palm Oil Trade Fair and Seminar 2010 in Kuala Lumpur yesterday.

While he foresees several pullbacks and corrections in the pricing in the immediate weeks, Lee was of the view that it will move towards RM2,800 and possibly surpass RM2,950 by the end of the year.