FX.co ★ Palm Oil Extends Declines

Malaysian palm oil futures declined to below MYR 3,950 per tonne, continuing their downward trend for a second consecutive session. This decline was attributed to increased production in March following delayed harvests in February caused by heavy rainfall and flooding. Additionally, palm oil stocks saw their first increase in seven months, rising to 1.56 million tonnes in March. Market fluctuations continued amid mixed signals regarding US tariffs—while Beijing refuted claims of discussions to reduce levies, US Treasury Secretary Scott Bessent indicated that the decision was now in China’s hands. Nonetheless, robust export projections helped prevent further price drops; data from cargo surveyors highlighted a shipment increase of 13.8% to 14.8% from April 1–25 compared to the previous month. In India, the leading palm oil importer globally, demand is expected to rebound in April following five months of reduced purchases. This resurgence is likely driven by decreased prices and improved margins when compared to soybean oil. In March, India imported 424.6 thousand tonnes of palm oil, marking a 13.7% rise from February, although this figure remains 38% lower than the corresponding period last year.