Strong export outlook supports palm oil prices

Malaysian palm oil futures extended gains for a second consecutive session on August 5. The benchmark October contract on Bursa Malaysia rose 0.3% to 4,710 ringgit per ton (about $1,152/ton). The market was supported by expectations of robust export demand from key importing countries, although weaker soybean oil and crude oil prices continued to limit further gains.

According to market analysts, expectations of strong exports remain the main bullish factor. India increased its edible oil imports in July to the highest level in ten months, with refiners boosting purchases of palm and soybean oil to replenish inventories ahead of the country’s festive season amid tightening domestic supplies.

At the same time, falling soybean oil and crude oil prices continue to weigh on market sentiment. Lower crude oil prices reduce the attractiveness of palm oil as a biodiesel feedstock, limiting the upside potential for palm oil prices.

The Malaysian market also received support from a slight weakening of the ringgit against the U.S. dollar. A weaker local currency makes Malaysian palm oil more affordable for overseas buyers, improving its competitiveness in the global vegetable oils market.

Meanwhile, European Commission data showed weaker demand in the European Union. As of August 2, EU soybean imports in the 2026/27 season had fallen 50% year-on-year to 0.66 mln tons, while palm oil imports declined 31% to 0.19 mln tons.

Tags: palm oil, prices