After a recent rally, palm oil prices have turned to the downside

According to the experts of the Malaysian Palm Oil Council (PMOC), in April, as a result of the reduction in production, palm oil stocks in the country fell to an 11-month low, as a result of which quotations for it rose by 5.5% at the beginning of the week.

However, on Wednesday and Thursday, prices fell by the same 5.5% to the level of the previous week on the data of the survey company Intertek Testing Services on the increase of palm oil exports from Malaysia for May 1-10 by 10.03% compared to the same period in April.

Malaysia's palm oil inventories fell for a third straight month, falling 10.54% to 1.5 million tonnes in April, the lowest since May 2022. Due to seasonal factors, output fell 7.13% in April to 1 .2 million tons, which was the lowest value since February 2022. Exports of palm oil in April decreased by 27.78% to 1.07 million tons, while traders and market operators expected a reduction of only 18-21%.

July palm oil futures on Malaysia's Bursa exchange yesterday fell 2.83% to 3,604 ringgit/t, or $812.6/t, the same as May 5.

Prices are under pressure from increased supply from Indonesia and India's approval of duty-free imports until the end of June for soybean and sunflower oil shipped by March 31, as hundreds of thousands of cargoes are stuck at ports due to confusion over import rules. It will be recalled that at the beginning of the year, India canceled the duty-free import quota of 2 million tons of crude sunflower and soybean oil for the current fiscal year, which began on April 1.

On the Chinese stock exchange in Dalian, soybean oil futures fell by 3.2%, and palm oil futures fell by 3.6%.