Palm oil prices remain at record levels due to uncertainty with exports from Indonesia

Malaysian palm oil futures were trading with a slight deviation from 5,550 ringgit/ton on Friday amid strong global market volatility and uncertainty about the impact of Indonesia's new restrictions on palm oil exports.

Last week, Indonesian authorities imposed a mandatory sale by palm oil producers of 20% of their products on the domestic market at fixed prices, which shocked world vegetable oil markets. This decision worsened the prospects for exporting raw palm oil from Indonesia and led to the fact that traditionally the cheapest vegetable oil became the most expensive of the three main food oils in the world.

April palm oil futures on the Malaysian stock exchange rose to 5,568 ringgit/ton.

Global grain prices rose after falling on Thursday due to earnings fixing on Friday, and March soybean and corn futures even exceeded psychological price levels to confirm the upward trend.

According to the Singapore oilseed trader, soybean futures showed the highest weekly growth since June 2021, and next week purchases may sharply increase after the return of Chinese importers from the weekly weekend. So far, China has not reacted in any way to the reduction of the global soybean balance by major analysts, although it remains the main market participant, which affects pricing processes.

Global food prices recovered to a 10-year high in January due to an increase in the vegetable oil index, the FAO said.

Corteva Inc experts expect that this year, amid record demand, prices for cereals and oilseeds will remain high.

And Reuters analysts predict that palm oil prices will rise to 5608-5676 ringgit/ton after stabilizing at the support level of 5484 ringgit/ton.