Palm exports rise on the back of a strong three-session decline

The Malaysian palm futures market reversed the losses it had suffered for three sessions in a row on Wednesday as export data helped to offset concerns about high inventories and rising U.S. China trade tensions.

The benchmark contract for palm oil delivery in January on the Bursa Derivatives Exchange climbed 13 ringgit or 0.29% to 4,474 Ringgit ($1,057.93), a metric tonne, at the close.

Paramalingam Supramaniam is the director of Selangor brokerage Pelindung Bestari. He said that buyers are waiting for price drops before buying.

The market is vulnerable to selling pressure, Supramaniam said. "With end stock still high and the China/U.S. truce at risk of collapse, it remains susceptible to intermittent sales pressure."

Last week, the data of the industry regulator revealed that Malaysian palm oil stocks reached a two-year high.

Exports of Malaysian Palm Oil Products for the period October 1-15 rose between 12.3% to 16.2% in comparison with the same time period a month ago.

Dalian's palm oil contract, which is the most active contract, fell by 0.47%. Chicago Board of Trade soyoil prices were up by 0.16%.

As palm oil competes to gain a share in the global vegetable oils industry, it tracks the price fluctuations of competing edible oils.

Investors weighed the International Energy Agency’s forecast of a surplus supply in 2026, and tensions between China and the United States that could reduce demand.

Palm oil is less appealing as a biodiesel feedstock due to the weaker crude oil futures.

The palm ringgit's trade currency, the dollar, has weakened by 0.02%, making it slightly cheaper for foreign buyers.

Indonesia's energy minister has said that it may restrict the export of crude palm oil in order to guarantee a sufficient supply of biodiesel.

Malaysia has reduced its crude palm oil price reference for November to a level which maintains the export duty at 10%. ($1 = 4.2290 ringgit)

(source: Reuters)