Palm Oil Rebounds on Firmer Edible Oils, Export Optimism

Malaysian palm oil futures strengthened, hovering above MYR 4,650 per tonne and halting recent losses amid weaker ringgit and firmer rival edible oils on the Dalian and Chicago exchanges. Prices also found support from a modest rise in crude oil prices, on lingering uncertainty over diplomatic efforts to resolve the U.S.-Iran conflict, which continued to underpin the biofuel outlook. Optimism over exports further lifted the market, with cargo surveyors noting Malaysian palm oil shipments in July rose between 12.1% and 19.5% from June. Support also came from top grower Indonesia, where exports of palm oil rose 2.5% yoy in H1 2026, while stronger purchases by the world's largest consumer India are expected between July and October ahead of the festive season. However, gains were capped by Reuters forecasts that inventories likely hit a five-month high in July. Caution also grew ahead of China's July trade data, which could provide fresh clues on demand from major palm oil consumers.

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.