Malaysian Palm Oil Futures Decline Amidst Global Concerns
Malaysian palm oil market experienced a brief downturn, falling over 2% to a five-week low. This dip is attributed to expectations of weaker demand and an anticipated increase in production. With favorable weather conditions and improved productivity among new workers, production is expected to rise further in the second quarter. The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange closed down 67 ringgit, or 1.37%, to 4,074 ringgit ($879.63) per metric ton. This marked its lowest closing price since March 29.
|
CPO FUTURES PRICES IN RINGGIT |
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|
Month |
Last |
Open |
Change |
High |
Low |
|
May’24 |
4215 |
4299 |
-62 |
4299 |
4213 |
|
Jun’24 |
4131 |
4218 |
-73 |
4230 |
4131 |
|
Jul’24 |
4074 |
4145 |
-67 |
4167 |
4072 |
|
Aug’24 |
4018 |
4089 |
-56 |
4100 |
4014 |
|
BY TEAM ABDUL HAMEED |
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Malaysia Palm Oil Stocks Dip to 10-Month Low Amid Export Surge
Malaysia, the world’s second-largest palm oil producer, witnessed a notable decline in palm oil stocks at the end of March, marking their lowest level in 10 months. This dip came as a result of a significant surge in exports, countering a rebound in production, according to statements from the industry regulator.
- Decrease in Palm Oil Stocks in Malaysia
The Malaysian Palm Oil Board (MPOB) reported that palm oil stocks in Malaysia at the end of March plummeted by 10.68% compared to the previous month, reaching 1.71 million tonnes. This decrease, the lowest since May, reflects a dynamic shift in the market influenced by export trends and production levels.
- Production and Export Trends
During the same period, crude palm oil (CPO) production in Malaysia saw a notable increase of 10.57%, reaching 1.39 million tonnes. This surge was complemented by a substantial uptick in palm oil exports, which rose by 28.61% to 1.32 million tonnes, as stated by the MPOB.
Factors Influencing Palm Oil Market
While Malaysia’s palm oil market is showing signs of resilience, challenges loom on the horizon. The rise in soybean oil exports from South America poses a potential threat to palm oil exports, as soybean oil trades at a discount, exerting downward pressure on palm oil prices.
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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 Bearish Position due to narrow gap between rival soft edibles oils, it may hovering in the range of MYR3,950 to MYR4,250 per ton.
