FX.co ★ Palm Oil Ends 4-Session Rally on Profit Taking

Malaysian palm oil futures experienced a decline of approximately 1%, dipping to below MYR 4,350 per tonne, thereby ending a four-day upward trend. This downturn came as traders seized the opportunity to secure profits following prices reaching their peak since early April. The market sentiment was also influenced by a reduction in edible oil prices on the Dalian exchange, a firming of the ringgit, and anticipations of increased Malaysian production. According to industry data, July's production grew by 7.1% to 1.81 million tons, while inventories swelled to nearly a two-year high of 2.11 million tons. Additionally, there was a cautious atmosphere leading up to the release of China's July activity data, coupled with unease regarding the effects of comprehensive U.S. tariffs and diminished domestic demand. Nonetheless, futures remained up by approximately 3% for the week, marking a consecutive weekly gain, buoyed by robust exports—with shipments surging over 23% in the first ten days of August, as reported by cargo surveyors. Malaysia also adjusted its September crude palm oil reference price, increasing export duty to 10%. In India, the top importer, demand is expected to rise as buyers prepare for the mid-October Diwali festival.