Malaysian palm oil futures traded above MYR 4,550 per tonne, extending modest gains as firmer edible oil prices on the Dalian and Chicago exchanges underpinned market sentiment. Rising crude oil prices further enhanced palm oil’s attractiveness as a biodiesel feedstock.
Exports also lent support, with cargo surveyors reporting that shipments increased by between 10.6% and 11.1% in the first 25 days of June. Supply fundamentals remained constructive as weather-related risks continued to cloud production prospects.
Meanwhile, top producer Indonesia is set to implement its B50 biodiesel mandate from July 1, with a three-month transition period for retailers to clear existing stocks, reinforcing expectations of stronger domestic consumption. In India, imports are forecast to exceed 600,000 tonnes in June, up from 549,356 tonnes in May, highlighting resilient demand from the world’s largest buyer.
Upside momentum, however, was restrained by a stronger ringgit and cautious trading ahead of China’s PMI data later this week, which may provide fresh signals on demand from this key consumer.
