Palm Oil Dips Ahead of Key Monthly Data

Malaysian palm oil futures traded lower, hovering below MYR 4,600 per tonne and retreating after recent gains as softer Chicago soyoil prices weighed on sentiment. Also, market participants remained cautious ahead of the Malaysian Palm Oil Board’s monthly report, with Reuters projecting stocks likely hit a record June high as output outpaced demand. In India, the world’s top buyer, June imports fell to a 14-month low on sluggish consumption and a narrowing discount versus rival oils. Still, losses were cushioned by a weaker ringgit, firmer edible oil prices on China’s Dalian exchange, and stronger crude oil, which boosts palm’s appeal as biodiesel feedstock. Demand prospects brightened after cargo surveyors estimated July 1–5 exports rose between 10.6% and 11.1% from the same period in June. Meanwhile, in China, another major importer, consumer prices rose less than expected while factory-gate inflation showed signs of peaking, underscoring a mixed backdrop for edible oil demand.

Malaysian palm oil futures traded above MYR 4,550 per tonne, rebounding from the prior session’s lull as a weaker ringgit and strength in Dalian and Chicago edible oil markets lent support. Exports also lifted sentiment, with cargo surveyors estimating July 1–5 palm oil shipments rose between 10.6% and 11.1% from the same period in June. A rally in crude oil prices added to the upside after U.S. airstrikes on Iran and renewed sanctions on its oil exports boosted palm’s appeal as a biodiesel feedstock. However, gains were capped by palm oil imports by top consumer India declining to a 14-month low in June amid sluggish demand and narrower discounts versus rival oils. Meanwhile, Reuters projected Malaysian inventories likely hit a record June high as output outpaced demand. At the same time, traders remained cautious ahead of the Malaysian Palm Oil Board’s monthly report later this week. In China, another key buyer, June CPI and PPI data will be closely watched for fresh cues on demand.

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.