FX.co ★ Palm Oil Retreats on Stronger Ringgit, Weak Exports

Malaysian palm oil futures fell more than 1% to below MYR 4,500 per tonne, erasing gains from the previous session amid a stronger ringgit and weakness in Dalian’s edible oil markets. Trading activity was further thinned as the Chicago market was closed for a holiday.

Sentiment also came under pressure from broader energy markets, with crude oil prices slipping to two-week lows on optimism that the U.S. and Iran were moving closer to a peace deal. On the demand side, weak export data weighed on risk appetite: cargo surveyors reported that palm oil shipments for May 1–20 declined by between 13.9% and 20.5% compared with April.

In India, the world’s largest palm oil importer, April purchases fell 26% to a four-month low, reflecting softer institutional demand and a reduced price advantage versus alternative oils.

However, losses in Malaysian futures were partially limited by expectations of tighter exports from Indonesia, the top producer, as new export restrictions are phased in from June to August ahead of full implementation in September, a move that could divert more demand to Malaysia. Additionally, Jakarta plans to raise its biodiesel blending mandate to B50 in July, while Malaysia is preparing to increase its own blending mandate to B15 in June.