FX.co ★ Palm Oil Eyes Third Monthly Loss Amid 7-Month Price Lows

Malaysian palm oil futures fell nearly 2.0% to dip below MYR 3,870 per tonne, ending a five-session winning streak. This decline was influenced by weak performances in competing edible oils on both the Dalian Exchange and the Chicago Board of Trade. Market sentiment was further dampened by caution surrounding the upcoming release of May PMI data from China, a key buyer, as traders continued to express concerns about sluggish activity in the manufacturing and services sectors, despite the implementation of supportive measures by Beijing amid escalating global trade barriers. These futures contracts are heading for a third consecutive monthly drop—currently down over 1%—as prices remain close to a seven-month low, underscoring ongoing anxieties over increasing stockpiles and production levels. However, on a more optimistic note, exports have shown signs of recovery, with cargo surveyors predicting a 7.3%–11.6% rise in shipments between May 1 and May 25. In India, the largest consumer of palm oil globally, demand is anticipated to rise as declining prices make palm oil more economical than soybean oil, prompting refiners to boost inventory levels due to robust production in both Malaysia and Indonesia.