Palm Oil Hovers at 20-Week High

Malaysian palm oil futures extended recent strength, trading near MYR 4,900 per tonne and reaching their highest level since early April. Support came from firmer edible oils in Dalian and Chicago markets, alongside stronger crude oil prices amid continued uncertainty over shipping through the Strait of Hormuz and potential disruptions to global trade flows. Meanwhile, the Malaysian Palm Oil Council projected prices to stay firm above MYR 4,600 in September, citing tightening supply and trade disruptions. However, upside momentum was tempered by elevated inventories, with July stocks climbing to a five-month high. In India, record soyoil imports expected in August could dent palm oil demand, as refiners may favor cheaper soyoil ahead of festive-season consumption. Export signals were mixed: Intertek reported shipments down 7.9% during August 1–15 from the same period in July, while AmSpec estimated a 3.2% rise, leaving traders cautious on near-term direction.

Malaysian palm oil futures extended recent gains, hovering above MYR 4,800 per tonne and reaching their highest level since early April. Firmer edible oils on the Dalian and Chicago markets supported sentiment, while higher crude oil prices provided an additional boost as prospects for a deal to end the Middle East war appeared increasingly distant. However, a stronger ringgit limited further gains. Elevated inventories also remained a headwind, with Malaysia’s palm oil stocks rising to a five-month high in July as production outpaced exports. In top consumer India, record soyoil imports expected in August could weigh on palm oil demand, as competitive prices encourage refiners to favor the cheaper alternative ahead of festive demand. Export signals were mixed, with Intertek Testing Services estimating Malaysian palm oil product shipments fell 7.9% in August 1–15 from a month earlier, while AmSpec Agri Malaysia reported a 3.2% increase.

Malaysian palm oil futures surged over 2% to around MYR 4,820 per tonne, marking their highest level since early April and rebounding from recent weakness. Firmer edible oils on the Dalian exchange lifted sentiment, while bargain hunting added support. Demand prospects improved as India's edible oil imports hit a 10-month high in July, with refiners replenishing palm oil and soyoil stocks ahead of the festival season. However, gains were capped by a stronger ringgit and weaker soyoil futures in Chicago markets. Meanwhile, elevated inventories remained a drag, with Malaysia’s July palm oil stocks climbing to a five-month high as production outpaced exports. Simultaneously, export prospects softened, with Intertek estimating shipments fell 7.9% in August 1–15 from the same period in July. Traders also turned cautious ahead of China’s July activity data, including retail sales and industrial output, which could provide fresh clues on demand in another key market.