Palm Oil Edges Up on Stronger Exports, India Demand Hopes

Malaysian palm oil futures inched higher to trade around MYR 4,650 per tonne, recovering from recent weakness amid a softer ringgit and firmer rival edible oils on the Dalian and Chicago exchanges. Sentiment was further lifted by stronger export prospects, with cargo surveyors estimating Malaysian palm oil shipments in July rose between 12.1% and 19.5% from the same period in June. Prices also drew support from higher biodiesel blending mandates in Indonesia and Malaysia, weather-related risks to Malaysia's 2027 output, and expectations of stronger imports by the world's largest importer, India, between July and October ahead of the festive season. In China, another key buyer, the central bank pledged to maintain ample liquidity after last week's Politburo meeting, raising hopes for firmer demand. However, gains remained limited as Dalian palm olein softened and crude oil prices eased after U.S. President Trump refrained from launching a fresh attack on Iran.

Malaysian palm oil futures slipped below MYR 4,650 per tonne, reversing recent gains as softer rival oils in Dalian and Chicago pressured sentiment. The benchmark contract was set to close the week down about 1.7% so far, ending a three-week winning run, after Indonesia, the world's largest palm oil producer, cut its August crude palm oil reference price to USD 996.52 per tonne from USD 1,000.90 in July. Still, prices remained roughly 2% higher for the month, the first monthly rise in four months, supported by about a 20% surge in crude oil during July as U.S.-Iran diplomacy eased Middle East tensions, boosting palm’s biodiesel appeal. Export demand also stayed firm, with cargo surveyors noting July 1-25 shipments up between 8.1%-15.9% from the same period in June. Further support came from higher blending mandates in Indonesia and Malaysia, weather risks to next year’s Malaysian output, and hopes of stronger imports by top buyer India between July and October ahead of festive demand.

Malaysian palm oil futures fell to near MYR 4,650 per tonne, reversing recent gains amid a stronger ringgit and weaker rival edible oils on the Dalian and Chicago exchanges. Meanwhile, crude oil prices eased as tanker traffic through the Middle East continued despite persistent regional tensions, reducing support for vegetable oil markets. Separately, European Union palm oil imports for the 2026/27 marketing year, which began in July, plunged by 39% yoy. Still, losses were capped by stronger exports, with cargo surveyors noting palm oil shipments for July 1–25 rose between 8.1% and 15.9% from the same period in June. Demand was also lifted by expectations that palm oil imports by top buyer India could increase between July and October ahead of the festive season. In Indonesia, the world's largest producer, authorities have raised the 2026 palm oil-based biodiesel allocation to 16.75 million kilolitres to accommodate additional demand from the B50 mandate launched earlier this month.