Palm oil prices rose 4.9% for the week as inventories in Malaysia fell to a 7-month low

Last week, palm oil futures in Malaysia rose in anticipation of a report on production, exports and inventories, due on March 10.

Yesterday, May palm oil futures on Bursa Malaysia rose another 1% to RM4,131/t or $883/t (+4.9% for the week), the highest since July 24, 2023.

According to the Malaysian Palm Oil Council (PMOC), in February, palm oil production in the country decreased by 10.18% compared to January to a 10-month low of 1.26 million tons, exports by 24.75% to 1.02 million tons, and stocks – by 5% to a 7-month low of 1.92 million tons.

In the March report, USDA experts reduced the forecast of palm oil exports from Malaysia by 0.4 to 15.8 million tons (15.36 million tons in FY 2022/23), and from Indonesia by 0.5 to 27.7 (28, 07) million tons

Palm oil is still more expensive than soybean and sunflower, so its exports will continue to decline in the near term, especially given the seasonal increase in soybean oil production in Argentina.

May soybean oil futures on the Chicago Stock Exchange for the week rose by 3.2% to $1,027/t (-1.6% for the month) on forecasts of a sharp reduction in the soybean harvest in Brazil. However, USDA experts reduced the forecast for Brazil by only 1 to 155 million tons, which, against the background of an expected harvest of 50 million tons in Argentina, will continue to keep prices low in the coming weeks.

Tags: prices, Malaysia, palm oil, stocks