After a long weekend, palm oil prices in Malaysia fell by 11%

July palm oil futures on the Malaysian Stock Exchange on April 29 reached a record 7104 ringgit / ton amid a ban on oil exports by Indonesia's main competitor. After that, from May 1 to 5, the auction was not held due to the national holiday. But on May 6, quotations fell immediately by 11% to 6400 ringgit / t or 1463 $ / t, losing growth the previous week.

The collapse was caused by declining oil exports from Malaysia due to high prices, as well as forecasts of Indonesia's easing of export restrictions in the near future.

In April, palm oil exports from Malaysia fell by 5.6% to 1.2 million tonnes, while in March they fell by 16% amid falling demand from China, India and the EU due to too high prices.

Palm oil reserves in the country increased in April (for the first time in six months) by 5.2% to 1.55 million tons due to production growth of 4.9% to 1.48 million tons.

Within a week of Indonesia's ban on exports of crude palm oil, refined, bleached and deodorized palm oil and waste cooking oil, there has been no significant drop in domestic prices, raising doubts among market participants about the ban .

According to the country's Ministry of Trade, the average price of bulk oil fell by only 1.5% to 17.2 thousand rupees / liter , although earlier Minister for Economic Affairs Erlang Hartarto said that the export ban will remain in force until the price of oil falls. throughout the country up to 14 thousand rupees / liter .

According to Sahat Sinaga, executive director of the Indonesian Association of Vegetable Oil Processors (GIMNI), the export ban has not yet significantly affected wholesale prices for vegetable oils.

The decline in palm oil prices will significantly increase the pressure on soybean and sunflower oil prices, which reach $ 1900-2000 / t C&F for deliveries in May-June.