Palm Oil Rebounds After 2-Day Decline – Support from Soy Oil Recovery
Palm Oil Rebounds After 2-Day Decline – Support from Soy Oil Recovery
Palm oil futures on the Malaysian exchange climbed on Friday, recovering from earlier losses. Gains were fueled by a rebound in CBOT soy oil, stronger demand signals, and mild optimism around export volumes heading into June.📊 Market Overview – MDEX Futures (Malaysian Derivatives Exchange)
💱 Approx. exchange rate: 1 USD = 4.28 MYR → ~USD 899–902/t🌍 Key Market Drivers
- Soy Oil Recovery Helps Stabilise SentimentAfter two days of sharp losses, soy oil on the CBOT rebounded by +1.55%, providing much-needed support to vegetable oil markets.
- Technical Bounce & Bargain BuyingPalm oil contracts found a floor after testing support near 3,820 MYR/t. Traders stepped in ahead of the weekend, expecting stronger short-term demand.
- Rising Production Still a ConcernForecasts for increased production in June and July continue to weigh on the outlook. However, rising exports to India and the Middle East ahead of the festival season are providing a partial counterweight.
- Crude Oil Volatility Adds ComplexityWeakness in global energy markets may still temper palm oil's upside due to its biodiesel linkage.
💼 Trading Strategy & Outlook
The market may attempt to hold above the 3,850 MYR/t mark heading into next week. Bullish momentum depends on continued soy oil strength and supportive export data.Recommendations:– Longs may be initiated above 3,850 with targets at 3,880–3,910 MYR– Monitor external oil markets and cargo surveyor data early next week– Sellers should remain cautious as price momentum returns
📈 3-Day Price Forecast (MDEX Aug 25)
🧭 Commentary – Biodiesel & Global Oils
- 📉 CBOT soy oil rebounded after a sharp 3% drop this week
- 📦 Indonesia and Malaysia report rising cargo demand
- ⚠️ Biodiesel margins remain under pressure in Asia