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The Malaysian Palm Oil Council said in a statement that crude palm oil prices are expected to remain stable at around RM4,400, equivalent to about US$1,110, per metric tonne in June. This stability is supported by global biofuel policies, which continue to underpin prices, as well as weather risks that are increasing uncertainty over supplies.
The council explained that recent biofuel developments in the United States have strengthened palm oil’s price competitiveness across key markets. Palm oil remains the most price-competitive vegetable oil in India, while Malaysian palm olein is trading at a slight discount to Argentine soybean oil. This pricing dynamic is expected to continue supporting palm oil demand.
The council also said vegetable oil prices still have room for future gains, noting that the recent price correction was likely driven by profit-taking by funds and speculators.
Supply risks also remain due to ongoing geopolitical tensions and the rising threat of the El Niño weather phenomenon, which could bring drier-than-usual conditions to Southeast Asia and negatively affect crop and vegetable oil production globally in the coming season.
On exports, combined palm oil shipments from Malaysia, Indonesia and Thailand rose by 1.9 million tonnes in the first quarter of the year. However, market analyst Oil World expects this trend to reverse, with exports declining by 2 million tonnes during the second and third quarters, mainly due to lower Indonesian shipments.
Source: Business Recorder
