FX.co ★ Palm Oil Reverses Losses

Malaysian palm oil futures experienced a 1% increase, surpassing MYR 4,130 per tonne on Tuesday. This rise marked a recovery from a previous downward trend, spurred by a depreciating ringgit and stronger performance of competing oils on the Chicago and Dalian exchanges. On the demand front, projections indicate that imports by India, the world's largest palm oil consumer, will rise significantly to 9.3 million tonnes in the 2025/26 period, an increase from the previous 7.58 million tonnes—the lowest in five years—fuelled by increased food demand and more competitive pricing. In China, lacklustre November PMI figures have led to optimism for upcoming policy measures, particularly with the Central Economic Work Conference scheduled for next week. Nevertheless, further price gains are constrained by indications of reduced exports, as reported by Intertek, which noted a 19.7% month-on-month decline in November shipments. Meanwhile, Indonesia, the largest global palm oil supplier, has reported that recent natural disruptions such as floods, landslides, and cyclones in Sumatra have not significantly affected production, thus tempering expectations for price increases driven by supply constraints.