Trading FEPO vs FCPO
Key to take away for Future East Palm Oil (FEPO)
1. Port of delivery location :
i)Lahad Datu
ii)Sandakan
iii)Bintulu
Port Location advantage?
i) Closer to China which is the largest export for CPO. Less shipping cost for oil collection.
ii) Closer to Japan/Korea/Philipines/Vietnam
2. Trading hour : 9.00am~12.30pm and 2.30pm~6.00pm.
Why start 9am? To cover the client from Dalian Commodity Exchange (China)
3. Export Palm related products from 2013-2020 surpassed Peninsular Malaysia.
4. Monthly CPO spread price on average for East Malaysia is at discount to Peninsular price by RM46.40/MT. Buyers will be always looking at a lower price.
5. Ongoing Trans-Borneo highway help to sustain CPO growth.
6. Expansion of Palm Oil (PO) area. Convert from logged-over forest and cocoa plantations.
7. High productivity due to mainly Sabah mineral soils and adequeate & even rainfall distribution.
Key challenges facing CPO producers at East Malaysia
1. Declining CPO yields.
i) Sabah: labor shortage, old trees, diseases, and weather issues.
ii) Sarawak: labor shortage, land dispute, land suitability, old trees, and weather issues.
Any effect to FCPO?
1. FEPO Position limit still lower than FCPO.. might reduce FCPO volume, but still sustainable.
2. FEPO volume mainly will coming from Dalian Commodity Exchange.
Can i trade FEPO?
1. Yes. but since the volume still low, technical analysis will be difficult.
Market sentiment will mainly depend on the fundamental analysis to understand supply and demand.
2. Use Gann technical analysis is possible
1. Port of delivery location :
i)Lahad Datu
ii)Sandakan
iii)Bintulu
Port Location advantage?
i) Closer to China which is the largest export for CPO. Less shipping cost for oil collection.
ii) Closer to Japan/Korea/Philipines/Vietnam
2. Trading hour : 9.00am~12.30pm and 2.30pm~6.00pm.
Why start 9am? To cover the client from Dalian Commodity Exchange (China)
3. Export Palm related products from 2013-2020 surpassed Peninsular Malaysia.
4. Monthly CPO spread price on average for East Malaysia is at discount to Peninsular price by RM46.40/MT. Buyers will be always looking at a lower price.
5. Ongoing Trans-Borneo highway help to sustain CPO growth.
6. Expansion of Palm Oil (PO) area. Convert from logged-over forest and cocoa plantations.
7. High productivity due to mainly Sabah mineral soils and adequeate & even rainfall distribution.
Key challenges facing CPO producers at East Malaysia
1. Declining CPO yields.
i) Sabah: labor shortage, old trees, diseases, and weather issues.
ii) Sarawak: labor shortage, land dispute, land suitability, old trees, and weather issues.
Any effect to FCPO?
1. FEPO Position limit still lower than FCPO.. might reduce FCPO volume, but still sustainable.
2. FEPO volume mainly will coming from Dalian Commodity Exchange.
Can i trade FEPO?
1. Yes. but since the volume still low, technical analysis will be difficult.
Market sentiment will mainly depend on the fundamental analysis to understand supply and demand.
2. Use Gann technical analysis is possible
Comment:
Gann analysis
