Palm oil prices in Malaysia have seen a slight decline, currently stabilizing just under MYR 3,930 per tonne. This follows an increase in the previous session due to expectations of rising inventory levels. According to a Reuters forecast, palm oil stocks rose for the third consecutive month in May, supported by a modest production recovery. Adding pressure on the market are declines in competing edible oils on the Chicago and Dalian exchanges. Palm oil has faced difficulty in recovering from the seven-month lows recorded in early May. This is due to factors such as favorable weather conditions, replanting activities, and improved practices among smallholder farmers, all of which are anticipated to boost production in the coming months. However, a limiting factor to the decline is the reported surge in demand from India, the largest palm oil importer, where imports reached a six-month peak in May following a previously subdued purchasing phase. To combat inflation and ensure adequate supply, India reduced import duties on crude edible oils, including palm oil, by half to 10% last week. On the export side, May saw robust performance, with cargo surveyors reporting shipment growth ranging from 13.2% to 17.9%.
The material has been provided by InstaForex Company – www.instaforex.com
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