FX.co ★ Palm Oil Rises After Two Days of Losses

Malaysian palm oil prices increased by approximately 1%, surpassing MYR 3,850 per tonne, thus interrupting a two-day downward trend. This rise was supported by stronger soybean oil prices on the Chicago Board of Trade (CBOT). Market sentiment improved following remarks from an industry expert at a Jakarta forum, who predicted that demand from major purchasers like India and China is anticipated to increase in the upcoming months, with recent price corrections providing appealing entry points. Additionally, export volumes are expected to reach their peak by August. The Malaysian Palm Oil Board reported a significant rise in May shipments, climbing 25.6% from April to reach 1.39 million tonnes—marking the highest level since November. Nonetheless, prices remain roughly 1% lower for the week, lingering at 7-month lows due to unfavorable market data affecting sentiment. Stocks at the end of May rose by 6.65% to 1.99 million tonnes, marking the third consecutive monthly increase and the highest level since September 2024. Meanwhile, palm oil production increased for the third consecutive month, up 5.05% to 1.77 million tonnes. Uncertainty caused by a tenuous trade truce between the U.S. and China also exerted pressure on prices, as the latest discussions yielded few concrete results.