Malaysian palm oil prices fall 2.5% to 3-week low

May palm oil futures fell 2.5% on Friday to 3- weekly low of 4,098 ringgits/t or $907/t.

Prices were not supported even by data on the increase in palm oil exports from Malaysia for the period March 1-10 by 45.3% compared to the same period in February and the reduction of stocks. At the end of February, palm oil stocks in Malaysia decreased by 6.6% compared to January to 2.12 million tons, which is the lowest figure in the last 6 months, the Palm Oil Council of Malaysia (PAC) reports.

According to the Ministry of Internal Affairs and Communications, production of palm oil in Malaysia in February decreased by 9.35% compared to January to 1.25 million tons, and exports - by 1.99% to 1.11 million tons, which also supports the quotation.

After the USDA report, May soybean oil futures on the Chicago Stock Exchange fell 4.2% to $1,247/t in three days, down 6.5% from the previous month and 9.5% from a year ago. .

The world balance of vegetable oils for FY 2022/23 has undergone the following changes compared to February estimates:

• The forecast of world production of oils has been reduced by 0.36 million tons to 217.22 million tons, which will exceed the figure of 208.53 million tons in 2021/22 MR by 4.2%.
• At the same time, the soybean oil production forecast was reduced by only 0.7 to 60.2 million tons (59 million tons in FY 2021/22), despite a significant reduction in soybean production in Argentina.
• The forecast for palm oil production has been increased by 0.13 million tons to a record 77.56 million tons, which will exceed the 2021/22 FY by 4.9% and will be the main factor in the pressure on vegetable oil quotations.
• The estimate of the world's final reserves of vegetable oils was reduced by 0.38 million tons to 29.56 million tons, which will exceed the figure of 29.35 million tons in 2021/22 MR by only 0.8%.