FX.co ★ Palm Oil Pulls Back After Hitting 7-Week High

Malaysian palm oil prices fell below MYR 4,100 per tonne, breaking a two-day upward trend as traders opted to take profits following a seven-week high reached in the preceding session. Contributing to the decline were decreasing soyoil prices on the Chicago exchange, alongside growing geopolitical tensions in the Middle East and expectations of rising inventories in the upcoming months. Concurrently, palm oil production is anticipated to increase through September, continuing its growth for a third consecutive month this May, bolstered by favorable weather conditions and ongoing replanting initiatives. Despite these downward pressures, signs of robust export demand provided some support. According to data from cargo surveyors, Malaysian palm oil exports rose between 17.8% and 26.3% during the first half of June compared to the previous month. In India, the world’s largest palm oil consumer, imports surged by 84% in May from April, reaching a six-month peak due to low stock levels and more attractive pricing relative to soyoil and sunflower oil.