Palm oil futures are seeing significant gains, driven by positive performances in the vegetable oil markets of Dalian and Chicago. This upward movement has been particularly notable on the Bursa Malaysia Derivatives Exchange, where the benchmark February contract has reached 4,968 ringgit per metric ton. The strength of the vegetable oil markets, including a 0.96% rise in Dalian’s soyoil contract and a 0.54% increase in Chicago’s soyoil, has supported this trend. However, Dalian’s palm oil contract has seen a decline of 1.69%.
A key factor in the rise of Malaysian palm oil futures is the reduction in Malaysia’s palm oil inventories, which fell by 2.6% in November to 1.84 million tons. This decline comes amidst the lowest level of crude palm oil production in Malaysia for November in the past four years, as well as a 14.7% drop in exports. Despite this, early December export data shows slight improvements, which could help stabilise prices in the near future.
The increase in Malaysian palm oil futures reflects broader movements in the global vegetable oil market, influenced by price shifts on major exchanges. The tightening of Malaysia’s stockpiles may further fuel the rise in futures prices. Investors are also closely watching global economic indicators, including changes in Asian stock markets, the value of the dollar, and fluctuations in oil prices, as they anticipate how these factors could influence the market in the coming months.
The performance of global markets and the reduced stockpiles in Malaysia suggest the potential for continued price fluctuations in the palm oil sector.
Dekel Agri-Vision PLC (LON:DKL) aspires to become a leading agro-industrial company in West Africa, one that creates value for shareholders whilst at all times placing the interests of the local communities and environment in which it operates in at the heart of its operations.
