Palm Oil Set for Solid Weekly Gain

Malaysian palm oil futures hovered above MYR 4,600 per tonne, continuing their bullish momentum and notching a two-week high, lifted by a weaker ringgit and stronger exports. Cargo surveyors noted that palm oil shipments during June 1–15 rose between 9.6% and 23.8% from the same period in May. Meanwhile, imports by top buyer India are expected to exceed 600,000 tonnes in June after edging up to 549,356 tonnes in May. Expectations of lower production due to the lingering effects of El Niño also continued to support prices. In Indonesia, the world’s largest palm oil producer, the B50 biodiesel mandate is set to take effect on July 1 after fuel tests delivered positive results, boosting the domestic demand outlook. Contracts are also on track to end the week over 3% higher, with sentiment further supported by the Malaysian Palm Oil Council’s forecast that prices will hold between MYR 4,400 and MYR 4,650 in July. However, holidays in the Dalian and Chicago markets limited further upside.