Malaysian Palm Oil Futures Fall on Soybean Weakness and Stock Buildup
The Malaysian palm oil market took a hit as crude palm oil (CPO) futures closed lower on Bursa Malaysia Derivatives. The decline was attributed to weakness in soybean oil futures and higher stock expectations, according to Anilkumar Bagani, Commodity Research Head at Mumbai-based Sunvin Group.
Bagani noted that the absence of fresh destination buying and Indonesia's decision to retain the B50 biodiesel mandate next year instead of moving to B60 limited gains in palm oil futures. He also estimated a surge in Malaysian palm oil stocks at the end of August, with production expected to decline by 2% and exports by more than 5%.
The market is awaiting full August palm oil production estimates from the Malaysian Palm Oil Association and UOB Kay Hian, as well as forecasts for the Malaysian Palm Oil Board's August supply, demand, and stocks data. The physical CPO price for September South remained unchanged at RM4,670 per tonne.