Palm oil prices rose on Friday

According to Kenanga Futures analysts, the price increase was driven by higher prices for competing oils the previous day, as well as improved sentiment, as the narrowing price differential between palm oil and gasoil increases the attractiveness of palm oil for biodiesel production. Optimism following stronger export data in early March provided additional support, although gains could be limited by profit-taking ahead of the weekend, they add. Kenanga estimates support for the May futures contract at 4,500 ringgit and resistance at 4,620 ringgit.

Malaysian palm oil futures rose on Friday, recording a second consecutive week of gains, as a sharp rise in oil prices amid the Middle East conflict boosted demand for biodiesel feedstock.

The benchmark FCPO1 palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange rose 23 ringgit, or 0.51%, to 4,564 ringgit (US$1,159.26) per metric tonne at the close of trading, up 4.51% for the week.

The weekly gain was supported by a jump of more than 9% on Monday, the biggest daily jump in three years.

The most-active Dalian soybean oil contract rose 0.53%, while the CPO1 palm oil contract rose 0.62%. The Chicago Mercantile Exchange soybean oil contract fell 0.55%.

Palm oil prices follow those of competing edible oils as it battles for share in the global vegetable oil market.

Oil prices continued to rise on Friday and look set to rise throughout the week, as supply disruptions due to the Gulf War in the Middle East outweighed measures by the US and the International Energy Agency to alleviate supply concerns.

Meanwhile, APROBI, the Indonesian biofuels association, expects trials to blend 50% palm biodiesel (B50) into fuels no earlier than June or July, as previously planned by the Ministry of Energy.

According to the palm oil industry association GAPKI, Indonesia’s crude palm oil production is expected to reach 51.66 million metric tons in 2025, up 7.3% from the previous year.

India’s palm oil imports jumped 11% to a six-month high in February, as a steeper discount compared to competing oils prompted refineries to increase purchases and reduce sunflower oil imports.

Malaysia raised the reference price of crude palm oil for April, increasing the export duty to 9.5%, according to a circular published on the Malaysian Palm Oil Council’s website.

Tags: prices, palm oil