Palm Oil Rises Further Ahead of MPOB Monthly Report

Malaysian palm oil futures extended gains, hovering above MYR 4,500 per tonne as firmer edible oil markets in China's Dalian and Chicago exchanges provided support. Stronger export demand also lifted prices, with cargo surveyors estimating July 1–5 palm oil shipments rose between 10.6% and 11.1% from the same period in June. However, further gains were capped by a stronger ringgit, alongside reports that imports by top buyer India fell to a 14-month low in June amid sluggish demand and narrowing price discounts compared with competing vegetable oils. Meanwhile, Reuters forecast that Malaysian palm oil inventories likely rose in June to their highest level on record for the month, as stronger production outpaced demand. Investors also remained cautious ahead of the Malaysian Palm Oil Board's monthly report due later this week. Meanwhile, upcoming June CPI and PPI data from China, another key buyer, will be closely watched for clues on demand.

Malaysian palm oil futures jumped over 1% to above MYR 4,500 per tonne, halting a recent losing streak as a weaker ringgit and firmer edible oils in China’s Dalian and Chicago markets boosted sentiment. Bargain buying also emerged after prices hit a two-week low last week. Stronger export demand provided further support, with cargo surveyors estimating July 1–5 shipments rose between 10.6% and 11.1% from the same period in June. However, some traders adopted a cautious approach ahead of the Malaysian Palm Oil Board’s monthly report later this week. Attention also turns to June CPI and PPI in China, another major buyer, for demand cues. Separately, a Reuters poll suggested inventories likely hit a June record as output outpaced consumption. In top buyer India, imports fell to a 14-month low amid sluggish demand and narrowing discounts versus rival oils. On the broader commodities front, crude eased as exports through the Strait of Hormuz recovered.

Malaysian palm oil futures edged lower, hovering below MYR 4,500 per tonne and extending recent losses as a stronger ringgit and weaker edible oil prices on the Dalian exchange weighed on sentiment. Meanwhile, Chicago markets are closed for a holiday. Caution also prevailed ahead of key supply-demand reports due next week. For the week, palm oil is set for a second straight decline, down about 1.5%, pressured by data showing imports by top buyer India fell to a 14-month low in June as sluggish demand and a narrowing price discount to competing vegetable oils reduced purchasing interest. Still, weakness was limited by firmer crude oil prices and improving export demand. Cargo surveyors estimated that palm oil exports during June 1-25 rose between 10.6% and 11.1% from May. Meanwhile, the B50 biodiesel mandate in Indonesia, the world's largest palm oil supplier, officially took effect on July 1, reinforcing forecasts of stronger domestic consumption and providing support to the market.