FX.co ★ Palm Oil Eases

Malaysian palm oil futures edged lower, consolidating below MYR 4,620 as traders took profits after the contract hit a near two-week high. Market sentiment softened in line with weaker edible oil prices on the Dalian exchange and sluggish export performance, with cargo surveyors reporting that shipments for April 1–20 fell by about 25.6%–25.8% from March amid a lack of festive-driven demand.

In China, a key consuming market, imports of major commodities—especially soybeans—are expected to decline this year, clouding the outlook for the broader edible oil complex. Even so, palm oil futures are up roughly 3.7% so far this week, recovering from losses in the previous two weeks, supported by a weaker ringgit and firmer crude oil prices linked to shipping disruptions in the Middle East.

Expectations of stronger demand from top buyer India have also increased, following a 19% month-on-month drop in that country’s palm oil imports in March. At the same time, Malaysia is advancing plans to raise its biodiesel mandate to B15 from the current B10, a shift that could absorb an additional 1–1.5 million tonnes of palm oil annually. The move is likely to tighten domestic supply as Kuala Lumpur follows Jakarta in expanding biodiesel blending requirements to reduce fuel imports.