2025.08.2004:11:54UTC+00Palm Oil Extends Losses

Malaysian palm oil futures have dipped below MYR 4,500 per tonne, marking a decline for the second consecutive session and retreating from a peak last reached 5-1/2 months ago. This downturn is largely attributed to profit-taking and a slump in rival edible oils on the Dalian and CBOT exchanges. Market participants are maintaining a cautious stance as they await the export estimates for August 1–20 from cargo surveyors. Despite these losses, there remains a degree of support for prices due to anticipated demand during festive periods from India's significant consumption and policy incentives from China, another key market. The Malaysian Palm Oil Council (MPOC) predicts that prices will remain above MYR 4,300 in the short term, driven by constrained supply and increasing demand for biodiesel. The council also highlighted that the USDA anticipates that over 50% of U.S. soybean production will be directed towards biodiesel use by 2026. Furthermore, Indonesia's proposed B50 mandate could increase the country's demand for palm oil to 16 million tonnes by 2025, up from 13 million. The MPOC does not expect a significant stockpile buildup during September and October, as diminished production in Peninsular Malaysia is expected to limit output growth.