Palm oil rises in Malaysia as India extends tariff cut on edible oil imports

Published 2024년 1월 16일

Tridge summary

Malaysian palm oil futures rose on Tuesday after India extended preferential import duty cuts on edible oils and Malaysia's lower production. This led to a 1.29% increase in the benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange. These factors, along with India's lower import duty structure, are expected to keep palm oil prices resilient and rising, especially given the decline in production in the first quarter. The strengthening of crude oil futures makes palm oil a more attractive feedstock option for biodiesel, despite some conflicting data on Malaysian palm oil product exports for the beginning of January.

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Original content

Malaysian palm oil futures rose on Tuesday, helped by top importer India's decision to allow edible oil imports at preferential duty for another year. The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange rose 49 ringgit, or 1.29%, to 3,849 ringgit ($821.91) by midday. India's decision to allow import duty cuts on edible oils until March 2025, coupled with lower production, has pushed up palm oil prices in Malaysia, said Paramalingam Supramaniam, director at brokerage Pelindung Bestari in Selangor, Reuters reported. The lower import duty structure on crude palm oil, crude sunflower oil and crude soybean oil in India, the world's largest importer of vegetable oil, is set to expire in March 2024. Supramaniam said preliminary estimates for palm oil production for Jan. 1-15 in Malaysia, the world's second-largest producer, fell 17%. “Prices will therefore remain resilient and continue to rise, especially given the decline in production in the ...

Source: Oilworld