Key Takeaways
- Malaysian palm oil futures ended the day flat after a four-day slide.
- Stronger Dalian oils offset pressure from weaker crude oil and vegetable oils markets.
- Palm oil prices remain under pressure due to rising inventories and India’s reduced import duties.
Malaysian palm oil futures closed the day unchanged, ending at 4,771 ringgit ($1,168.22) a metric ton, after a four-day decline.
The benchmark palm oil contract on the Bursa Malaysia Derivatives Exchange gained 3 ringgit, or 0.06%, from the previous session.
Despite the slight recovery, the contract fell 3.4% over the last four trading sessions, reflecting ongoing market volatility.
David Ng, a proprietary trader at Kuala Lumpur-based Iceberg X Sdn Bhd, noted that while firmer Dalian futures provided some support, the overall sentiment remained cautious due to recent weakness in crude oil and the broader vegetable oils market.
Dalian’s most-active soyoil contract rose 0.39%, while its palm oil contract added 0.68%, indicating a mixed market response.
Soyoil prices on the Chicago Board of Trade fell by 0.03%, contributing to the overall downward pressure on palm oil prices.
Oil prices rose more than 2% as diplomatic talks between the US and Iran showed little progress, with investors focusing on potential US bans on diesel exports.
The ringgit, Malaysia’s currency, weakened 0.17% against the dollar, making palm oil slightly cheaper for buyers holding foreign currencies.
Industry officials warned that palm oil prices are likely to remain under pressure due to rising inventories in Malaysia and sluggish buying by India, the world’s largest importer.
India has cut the basic import duty on crude and refined edible oils, including palm oil, soyoil, and sunflower oil, to lower prices during the peak festive season.
