FX.co ★ Palm Oil Slips Below MYR 4,250 as Export Outlook Dim

Malaysian palm oil futures have dipped below MYR 4,250 per tonne, witnessing a decline for the second consecutive session, primarily due to weaknesses in competing edible oils on the Dalian and CBoT exchanges. This bearish sentiment was exacerbated by indications of sluggish exports, as cargo surveyors reported that shipments of Malaysian palm oil products from July 1–25 fell by 9.2% to 15.2% compared to June figures. Expectations of abundant supplies have also added pressure on prices, as the Malaysian Palm Oil Board forecasts an increase in production to 19.5 million tonnes in 2025, up from 19.3 million in 2024, supported by enhanced labor availability. Nevertheless, any further price declines are being mitigated by a weaker ringgit and rising crude oil prices, following the U.S. reaching a trade agreement with the EU and hinting at a potential extension of its tariff suspension with China. On another note, robust demand from India, the largest consumer, is anticipated to persist, particularly in anticipation of the Diwali festival in mid-October. In June, India's palm oil imports soared to an 11-month peak, driven by depleted inventories and more competitive pricing compared to soyoil and sunflower oil.