FX.co ★ Palm Oil Under Pressure Ahead of Monthly Data

Malaysian palm oil futures fell nearly 2% to below MYR 4,500 per tonne, erasing earlier gains as a stronger ringgit and weaker edible oil prices on the Dalian and Chicago exchanges pressured the market. Sentiment was further dampened by a sharp decline in crude oil prices and caution ahead of the Malaysian Palm Oil Board’s monthly report due later this week, with Reuters reporting expectations of another inventory build in May. At the same time, cargo surveyors estimated that May shipments were 8.8%–15.5% lower than in April. Demand from India, the world’s largest palm oil importer, picked up modestly from April’s four-month low but remained below typical levels. Even so, the decline in prices was limited by robust Chinese trade data, with exports reaching a record high and imports accelerating in May, indicating resilient demand in a key destination market. Additional support came from Indonesia, the top producer, where new technical regulations tightened oversight of strategic commodity exports, including palm oil, potentially diverting some demand toward Malaysian supplies.