Palm oil, a variety of edible oil, is highly popular due to its wide-scale applications, in the form of preservatives in a variety of foods, a common cooking oil, and even in shampoos, cosmetics, and biofuels. The oil is derived from palm fruit and is distinguished by its higher oil content in comparison to other oil crops.
A spike in January stocks led to a decline in Malaysian Palm Oil futures on Friday, but the benchmark contract still gained on the week thanks to greater exports and higher Indonesian export taxes.
By the end of trading on 10th February 2023, the benchmark palm oil contract FCPOc3 for April delivery on the Bursa Malaysia Derivatives Exchange had fallen for a second consecutive day by 39 ringgit, or 0.98%, to 3,934 ringgit ($908.75) per tonne. The benchmark increased by 2.07% in the week, marking its third consecutive weekly gain.
Palm Oil Exports
Mr. Paramalingam Supramaniam, director at Selangor-based brokerage Pelindung Bestari said, “The exports are showing signs of recovery and with Indonesia increasing their taxes and levies, customers could actually turn their attention towards Malaysian cargoes.”
The leading Exporter Of Palm Oil in the world, Indonesia, intends to increase the price of crude palm oil for the period of February 16–28 to $880.03 per tonne, which will make it less competitive with Malaysia, a smaller competitor.
Exports from Malaysia during Feb. 1-10 rose 32.51% from the same period in January, independent inspection company AmSpec Agri Malaysia said on Friday.
Mr. Anilkumar Bagani, research head of Mumbai-based vegetable oils broker Sunvin Group, “Malaysian palm oil exports rose during the first 10 days of February thanks to lower prices and renewed purchases from India after the confirmation of the extension of refined palm oil import allowances under the free category.”
The Increase In Palm Oil Stockpiles
According to figures from the Malaysia Palm Oil Board (MPOB), Malaysia’s palm oil stockpiles at the end of January increased for the first time in three months, rising 3.27% from the previous month to 2.27 million tonnes. According to MPOB data, the increase was brought on by a boom in imports that partially offset a production decline of 14.73% and a nearly 23% decline in exports.
Dalian’s most active palm oil contract DCPcv1 gained 2.24%, while its most active soy oil contract DBYcv1 declined 1.83%. Soybean oil prices increased 0.64% on the Chicago Board of Trade BOcv1.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
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