FX.co ★ Palm Oil Subdued, Heads for Second Straight Weekly Loss

Malaysian palm oil futures were largely unchanged around MYR 4,900 per tonne after recent declines, as strength in Dalian edible oil markets was offset by weaker Chicago soyoil. Crude oil prices advanced amid renewed U.S.–Iran tensions, stoking supply concerns and lending support to sentiment. Mounting El Niño risks added a further bullish undertone, with increasingly dry conditions threatening output across Southeast Asia. Production in top exporter Indonesia is forecast to fall 2.9% to 56.8 million tonnes by 2027. The country is also expected to retain its B50 biodiesel mandate next year, with implementation reportedly already at about 80%.

On the demand side, prospects brightened in India, where refiners booked record soyoil imports and the largest palm oil volumes in six months ahead of the festive season. Even so, palm oil futures were on track for a second consecutive weekly decline, weighed down by sluggish exports. Cargo surveyors estimated that Malaysia’s August shipments fell 6.5%–14.9% from July, while supply remained ample, with domestic inventories at a five-month high in July.