Despite falling oil prices, palm oil is rising amid increased production and inventories in Malaysia

Published Sep 13, 2024

Tridge summary

Malaysian palm oil quotes have remained relatively stable, with a minimal decrease of 1%, despite a 10% drop in oil prices over the past two weeks. This is due to an increase in production and a decrease in exports, leading to a 7.34% rise in stocks to a 6-month high. However, the stock market responded positively to this "bearish" report, with October palm oil futures on Bursa seeing a 0.4% increase. Indonesia plans to reduce export duties to boost competitiveness and support local farmers, but analysts predict that palm oil prices may fall to 3,782-3,796 ringgit/t in the coming months.

Disclaimer: The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

Oil prices have fallen 10% in the past two weeks, but Malaysian palm oil quotes are down just 1%, although they are usually closely linked. According to the Malaysian Palm Oil Council (PMOC) report released yesterday, in August, the country's palm oil production increased by 2.87% compared to July to 1.89 million tons, while exports decreased by 9.74% to 1.53 million tons, as a result of which stocks increased by 7.34% to a 6-month high of 1.88 million tons. However, the stock market reacted rather unexpectedly to such a "bearish" report, and October palm oil futures on Bursa rose 0.4% to 3,901 ringgit/t or $900/t yesterday. Indonesia, the world's largest producer and exporter of palm oil, plans to lower export duties on it to increase competitiveness and oil exports and support local farmers. Analysts predict ...

Source: Graintrade