Malaysian palm oil futures dropped more than 1.5% to around MYR 4,600 per tonne, extending their recent decline to the lowest level since mid-October. Sentiment was pressured by a stronger ringgit, as well as weakness in both Dalian palm oil and Chicago soyoil markets. At the same time, crude oil prices eased amid renewed diplomatic efforts in the Middle East, denting palm oil’s attractiveness as a biodiesel feedstock.
The downside was compounded by record-high Malaysian stockpiles and growing caution ahead of China’s official PMI release, given China’s role as a key consuming market. In a separate development, EU palm oil imports in the 2026/27 season, which started in July, were down 21% year on year at 0.8 million tonnes.
Even so, expectations of tighter supplies next year—linked to El Niño-related weather risks—and stronger domestic biodiesel demand in Indonesia, the world’s largest producer, provided some support. Export demand also remained robust, with cargo surveyors reporting a 46.9%–67.7% jump in shipments during October 1–25 compared with the same period in September, partly reflecting pre-Diwali buying from top consumer India.
