FX.co ★ Palm Oil Pulls Back But Heads for Solid Weekly Gain

Malaysian palm oil futures have dipped below MYR 4,600 per tonne, breaking a three-session streak of gains as markets responded to the latest data from the Malaysian Palm Oil Board. As of the end of September, inventory levels had increased by 7.2% from the previous month, reaching nearly a two-year high of 2.36 million metric tons, while exports rose by 7.69% to 1.43 million tons. In India, which ranks as the world's largest consumer, demand in October is projected to fall below 600,000 tons, with festive purchases peaking after a near 16% decrease in September. Additionally, the recent decline in crude oil prices and the ongoing U.S. government shutdown, now in its ninth day, have also impacted market sentiment. Nonetheless, palm oil is on track for a second consecutive weekly increase, with gains of approximately 3% to date. This is largely bolstered by Indonesia, the leading global producer, which intends to implement B50 biodiesel in 2026 and introduce 10% bioethanol in gasoline as measures to reduce emissions and cut down on fuel imports. Conversely, output saw a 0.73% decrease in September to 1.84 million tons, marking its first decline in three months, according to industry data.