FX.co ★ Palm Oil Extends Gains, Weekly Loss Still Looms

Malaysian palm oil futures rose for a second consecutive session on Friday, trading near MYR 4,600 per tonne, supported by firmer edible oil prices on the Dalian exchange and a weaker ringgit. Sentiment was further underpinned by strong export demand, with cargo surveyors reporting that shipments for March 1–25 jumped 38–51% from February, highlighting solid post-Eid buying.

Higher crude oil prices amid ongoing tensions in the Middle East also lent support, bolstering the outlook for palm-based biofuel demand. Even so, the benchmark contract is poised to end the week marginally lower, down about 0.2%, as earlier gains were pared.

The pullback has been driven in part by expectations of softer Indian demand, with March imports estimated at 680,000 tonnes, compared with 847,689 tonnes in February. In Indonesia, authorities are moving to accelerate the nationwide rollout of B50 biodiesel while considering higher export taxes for April.

At the same time, markets remain cautious ahead of China’s March PMI data, due next week. China, a major palm oil buyer, saw factory activity slow in February amid the extended Lunar New Year holiday, adding to uncertainty over near-term demand.