Mumbai, June 27 (Commodities Control): Malaysian palm oil futures experienced their second consecutive day of gains on Thursday, closing at 3,895 ringgit ($825.56) per metric ton, a 0.41% increase.
This upward movement was primarily driven by forecasts of reduced production, which outweighed the potential impact of weaker demand stemming from India's recent duty concessions on edible oil imports.
India's decision to allow limited imports of specific oils under a tariff-rate quota (TRQ) aims to curb food inflation. However, despite this move, Malaysian palm oil exports during June 1-25 saw a significant decline of 16.1% to 16.9% compared to the same period in May.
Further bolstering prices, production in Malaysia, the world's second-largest palm oil producer, is projected to decrease by 6.3% year-on-year during June 1-20, according to industry data.
Additional support came from the broader vegetable oil market, with soyoil contracts on the Dalian and Chicago Board of Trade exchanges also experiencing gains.
The recent upward trajectory of palm oil futures demonstrates the complex interplay of factors influencing this commodity market. While India's efforts to control food inflation through duty concessions may potentially dampen demand, the prospect of reduced production in Malaysia has emerged as a dominant force, driving prices higher. This situation underscores the importance of closely monitoring both supply and demand dynamics in the palm oil market to make informed investment decisions.
Global Futures Palm oil and Soy Oil
(By Commoditiescontrol Bureau; +91-9820130172)
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