Palm oil prices rise amid strong Malaysian exports and higher soybean oil prices

Global palm oil prices rose on October 22, supported by stronger Malaysian exports, higher prices for competing vegetable oils, and rising crude oil prices. On Bursa Malaysia, the benchmark January 2027 contract gained approximately 0.5% to 4,793 ringgit ($1,174/t). Strong demand for palm oil and expectations of a seasonal decline in production continue to support the market.

One of the main drivers of the price increase was a sharp rise in Malaysian palm oil exports. According to independent cargo surveyors, shipments of Malaysian palm oil products increased by 58.5–78.4% during October 1–20 compared with the same period in September. This trend indicates a significant recovery in international demand and creates conditions for a potential reduction in stocks over the coming months.

Additional support for palm oil prices came from gains in soybean oil futures on international exchanges. Soybean oil prices on the Dalian Commodity Exchange rose by 0.59%, while Chicago Board of Trade (CBOT) futures increased by 0.53%. Meanwhile, Brent crude oil prices reached their highest levels since May, boosting interest in palm oil as a feedstock for biodiesel production. However, a 0.6% decline in palm oil futures on the Dalian exchange put some pressure on the market.

Despite rising prices, trading activity in the Malaysian market weakened slightly. Trading volume for the January contract fell by 17.7% to 29.1 thsd contracts, while open interest declined by 4.5% to 95.5 thsd contracts. This suggests that the current price increase has not yet been accompanied by a significant inflow of new positions in the futures market.

According to the Malaysian Palm Oil Council (MPOC), crude palm oil prices could remain above 4,600 ringgit per ton in November. The main supporting factors are expected to be strong export demand, stable biodiesel consumption, and a seasonal decline in production. However, elevated palm oil stocks in Malaysia could limit further price gains, leaving the market sensitive to changes in export demand and prices for competing vegetable oils.

Tags: soybean oil, Malaysia, palm oil