FX.co ★ Palm Oil Jumps to Above MYR 3,900

Malaysian palm oil prices experienced a notable increase of nearly 2%, climbing above MYR 3,900 per tonne. This rise follows a lackluster previous session and is attributed to similar upward trends in rival edible oils on the Dalian and Chicago exchanges. Additionally, crude oil saw a significant surge of almost 10%, hitting multi-month highs after Israel initiated airstrikes on Iran without the backing of the U.S., thus intensifying tensions in the Middle East. In India, the largest consumer, palm oil imports saw an 84% increase in May compared to April, reaching a six-month high due to low inventory levels and larger discounts compared to soyoil and sunflower oil. An industry expert predicts that exports may peak around August, a view supported by data from the Malaysian Palm Oil Board, which reported a 25.6% rise in May shipments from April, reaching 1.39 million tonnes, the highest since November. However, on a weekly basis, palm oil futures have dipped 0.2%, as prices continue to hover near seven-month lows amidst ongoing concerns about increasing inventories and anticipated continued production growth through September, driven by favorable weather conditions and replanting activities.