Mumbai, 11 Nov (Commoditiescontrol): On Monday, Malaysian crude palm oil (CPO) futures opened lower, influenced by declines in rival vegetable oils on the Dalian and Chicago markets. Traders are also keeping a close eye on the Malaysian Palm Oil Board’s (MPOB) monthly data, set for release later in the day.
The January benchmark palm oil contract on the Bursa Malaysia Derivatives Exchange fell by 12 ringgit, or 0.24%, to 5,089 ringgit ($1,157.12) per metric ton, ending a three-day upward streak.
The Dalian Commodity Exchange saw a mixed performance in vegetable oils, with the most-active soyoil contract declining by 0.32% while its palm oil contract rose 1.8%. In Chicago, soyoil prices on the Board of Trade were down 0.16%. Palm oil prices are often affected by movements in other edible oils, as they compete for a share in the global vegetable oil market.
Analysts forecast that Malaysia’s palm oil stocks likely declined in October, according to a Reuters survey. Despite recent fluctuations, Malaysian palm oil futures have risen over 35% in 2024, driven by limited supplies and steady demand. The price is projected to stay above 5,000 ringgit ($1,141) per metric ton through mid-2025, according to market expectations.
Indonesia, the world’s largest palm oil producer, is planning to increase its biodiesel mandate from 35% to 40% next year. This policy shift will require an additional 3 million tons of palm oil feedstock, which could further support prices. Additionally, the ringgit weakened by 0.46% against the U.S. dollar, making Malaysian palm oil more attractive to foreign buyers.
Meanwhile, global oil prices slipped as the threat of supply disruptions from a U.S. storm diminished, and China's latest economic stimulus plan underwhelmed investors looking for fuel demand growth in the world's second-largest oil consumer. Lower crude prices make palm oil a less appealing option for biodiesel production, adding further pressure on CPO futures.
On a technical level, analysts suggest that palm oil prices could rise to a range of 5,244 to 5,314 ringgit, as indicated by a powerful wave pattern in the market’s charts.
(By Commoditiescontrol Bureau: 09820130172)
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