Malaysian Palm Oil Futures Decline Amidst Global Concerns
Malaysian Palm oil futures experienced a notable uptick on Monday, interrupting a streak of losses seen in the previous two sessions. This surge in prices can be attributed to several factors, including robust export data and subdued output growth. The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange witnessed a 1% Or 61 increase, reaching 4,230 ringgit ($895.05) per metric ton during the midday break. This turnaround follows a decline of approximately 2% observed in the preceding two sessions. red palm oil
| Month | Last | Open | Change | High | Low |
| Apr’24 | 4354 | 4322 | 47 | 4375 | 4284 |
| May’24 | 4315 | 4266 | 63 | 4338 | 4232 |
| Jun’24 | 4249 | 4202 | 61 | 4273 | 4165 |
| Jul’24 | 4155 | 4119 | 49 | 4183 | 4085 |
|
CPO FUTURES PRICES IN RINGGIT |
|||||
Export Expansion and Production Trends
According to cargo surveyor Intertek Testing Services, Malaysian palm oil product exports surged by 13.8% from March 1 to March 25 compared to the previous month’s figures. This acceleration in export growth, notably higher than the 7.4% increase recorded from March 1 to March 20, has contributed significantly to the positive sentiment in the market. red palm oil
|
Palm Products |
March 1-25 |
Feb 1-25 |
|
Crude palm oil |
147,581 |
210,465 |
|
RBD Palm oil |
121,505 |
80,377 |
|
RBD palm olein |
327,653 |
270,206 |
|
RBD palm stearin |
72,666 |
69,609 |
|
Crude Palm kernel oil |
20,250 |
8,690 |
|
Palm fatty acid distillate |
45,235 |
20,860 |
Potential Policy Shift in Indonesia
Another factor bolstering palm oil prices is the prospective revision of Indonesia’s domestic market obligation (DMO) policy for cooking oil. As the potential impact of linking the DMO policy to production rather than exports. This proposed shift could tighten export availability, potentially leading to a bullish market outlook.
Deceleration in Palm Oil Buying and Shipping Trends in Indonesia
Palm oil purchasing has reportedly slowed down due to diminishing processing margins. Buyers are waiting for a price correction before re-entering the market. In Indonesia, the top producer, official data revealed that the country shipped 1.89 million metric tons of palm oil products in January and 1.01 million tons in February. These figures are below the monthly average observed over the past year. red palm oil
In conclusion, Malaysian palm oil market reveals a delicate interplay of domestic and global factors. As, these uncertainties, a comprehensive understanding of the evolving dynamics for Palm trade in Neutral To Bullish Position due to narrow gap between rival soft edibles oils, it may hovering in the range of MYR3,800 to MYR4,300 per ton.
