Palm Oil Holds Above MYR 4,700 Despite Record Stocks

Malaysian palm oil futures stayed firm above MYR4,700 per tonne, extending their upside momentum as strength in China’s Dalian edible oils and higher crude prices boosted palm’s competitiveness in biodiesel. Export signals were also upbeat, with cargo surveyors estimating October 1–10 exports jumped 33.5%–37.7% from the same period in September, while festive buying from top buyer India and firmer trading activity in China during September added support. Yet sentiment was checked by bearish monthly data from the Malaysian Palm Oil Board. September inventories surged 24.5% mom to a record 3.51million tonnes, the sixth monthly rise in a row. Output climbed 16.5% to 2.12million tonnes, the highest since August 2015, while exports fell 12.1% to 1.12 million tonnes, marking a second month of decline. Record-high stocks, stronger output, and weaker shipments underscored supply pressure, hinting that despite firmer near-term demand, further price gains may be capped by fundamentals.

Malaysian palm oil futures eased below MYR 4,600 per tonne after recent gains, pressured by weaker edible oils on the Dalian and Chicago markets and lower crude oil prices, which reduced palm oil’s competitiveness as a biodiesel feedstock. Sentiment remained bearish after monthly data from the Malaysian Palm Oil Board showed September inventories surged 24.5% month-on-month to a record 3.51 million tonnes, extending their rise for a sixth consecutive month. Simultaneously, production climbed 16.5% to 2.12 million tonnes, its highest since August 2015, while exports fell 12.1% to 1.12 million tonnes, marking a second straight monthly decline. Investors also awaited China’s inflation and trade data for fresh signals on demand in the key consuming market. However, losses were capped by signs of stronger October shipments, with cargo surveyors estimating Malaysian palm oil product exports rose 33.5%–37.7% month-on-month in October 1–10.

Malaysian palm oil futures jumped 1.3% to about MYR 4,650 per tonne, rebounding from earlier weakness as firmer prices on China’s Dalian market lent support. Export prospects also brightened after surveyor Intertek estimated Malaysia’s shipments surged 33.5% in the first ten days of October from the same period in September. In top buyer India, refiners reportedly booked around 150,000 tonnes of palm oil in three days last week, with sunflower oil supplies tight ahead of November’s festive demand. Even so, upside was capped by bearish monthly data from the Malaysian Palm Oil Board. September inventories swelled 24.5% to a record 3.51 million tonnes, extending a six-month rise. At the same time, output climbed 16.5% to 2.12million tonnes, the highest since August 2015, while exports fell 12.1% to 1.12million tonnes, marking a second monthly drop. Traders remained cautious, awaiting China’s inflation and trade figures later this week for further signals on demand in another key market.