Palm oil prices expected to remain high and firm in the near future

29-Aug-2024 06:19 PM

Kuala Lumpur. Palm oil prices are expected to remain bullish and firm for the next few months as production in Indonesia is declining and its use in biodiesel manufacturing is increasing.

Meanwhile, heavy imports of palm oil are expected in India in view of the festive season. According to trade analysts, the market may remain high till October-November.

According to an analyst, the futures price of crude palm oil in Malaysia remained above 3930 ringgit per tonne during five of the last six sessions, a major reason for which was the increase in the prices of palm oil and soybean oil in Dalian, China and Chicago Exchange of America.

The futures price of crude palm oil (CPO) for October delivery on Kuala Lumpur-based Bursa Malaysia Derivatives (BMD) Exchange closed at 3975 October ringgit per tonne on August 28.

The cost of CPO to India for October shipment is coming to $ 1030 (Rs 87,325) per tonne. This also includes shipment expenses.

According to a research agency, the futures price of crude palm oil for the third month was earlier estimated to be 3750 ringgit per tonne, which has now been increased by 100 ringgit or 2.7 percent to 3850 ringgit per tonne.

Earlier it was expected that the futures price of CPO would remain soft during the second half of the year 2024, but it could not soften as expected.

The research agency had also predicted that the price of CPO would not increase much till the beginning of the year 2025.

According to another reviewer, the outstanding surplus stock of palm oil in major producing and exporting countries is relatively low,

while production is also witnessing stability to a large extent. On the other hand, festive demand will remain strong in it.