Malaysian palm oil futures rose about 1.5% to above MYR 4,250 per tonne on Friday, extending the previous session’s gains and approaching a five-week high. The advance was supported by a weaker ringgit and firming prices for edible oils on the Dalian exchange.
Futures are on track for a weekly increase of roughly 5.5%, the strongest since mid-August, as crude oil prices surged amid the Middle East conflict, disrupting energy flows and bolstering the appeal of biofuels. Demand prospects also brightened after palm oil imports by top buyer India climbed 10.1% month-on-month in February to a six-month high, helped by wider discounts to competing vegetable oils.
At the same time, a Reuters poll suggested Malaysian palm oil inventories likely fell for a second consecutive month to a four-month low, with seasonal production declines outweighing weaker exports. Nonetheless, soft export performance capped further gains, as cargo surveyors reported that February shipments dropped by 21.5%–22.5% from January, despite Eid al-Fitr restocking.
Market participants also turned cautious ahead of key data from China, the leading importer, due next week, including CPI and PPI releases as well as trade figures, which could provide clearer signals on future demand.