FX.co ★ Palm Oil Market Subdued

Malaysian palm oil futures were trading around MYR 4,530 per tonne, stabilizing after sharp losses in the previous session. Support from a weaker ringgit and firmer Chicago soyoil was largely offset by declines in competing edible oils on China’s Dalian exchange. Market participants remained cautious ahead of official industry data, after a Reuters survey indicated another inventory build in May, as subdued exports more than offset lower production.

Demand from India, the largest buyer, showed a modest rebound from April’s four-month low but still lagged typical seasonal levels. At the same time, Indonesia, the world’s biggest palm oil exporter, implemented new technical regulations to tighten oversight of strategic commodity shipments, including palm oil. The move has raised concerns among Indonesian exporters and could redirect some demand to Malaysia. Even so, the export outlook remained weak, with cargo surveyor estimates suggesting May shipments fell by 8.8%–15.5% from April, highlighting ongoing softness in external demand.