MUMBAI, 11 Dec (Commoditiescontrol): Malaysian crude palm oil (CPO) futures continued their decline on Wednesday as traders locked in profits following earlier gains driven by a reduction in November stockpiles.
The benchmark February delivery contract on the Bursa Malaysia Derivatives Exchange closed 96 ringgit, or 1.94%, lower at 4,855 ringgit ($1,095.94) per metric ton.
The Malaysian Palm Oil Board (MPOB) reported on Tuesday that the country’s palm oil inventories fell for the second consecutive month in November, dropping 2.6% to 1.84 million tons. This reduction in stockpiles, alongside a 9.8% decline in crude palm oil production to 1.62 million tons—marking the lowest level for the month since 2020—has the potential to fuel future price rallies. However, palm oil exports also took a hit, plunging 14.7% to 1.49 million tons.
Globally, edible oil markets showed mixed trends. On China's Dalian Commodity Exchange, palm oil futures fell 1.12%, while the most-active soyoil contract rose 1.72%. In Chicago, soyoil prices climbed 0.68%. Palm oil prices often track movements in rival edible oils, as they compete in the global vegetable oils market.
Data from cargo surveyors provided some support to the market. Intertek Testing Services reported a 3.9% rise in Malaysian palm oil product exports between December 1-10, while AmSpec Agri Malaysia recorded a 1.1% increase for the same period.
Meanwhile, crude oil prices surged on Wednesday, buoyed by expectations of higher demand from China following Beijing's decision to ease monetary policy to stimulate economic growth. Stronger crude oil prices enhance the attractiveness of palm oil as a biodiesel feedstock, providing additional demand-side support.
Despite falling stockpiles and production, the market remains under pressure from weak export demand and profit-taking activity, with traders closely watching global trends and technical price levels for future direction.
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(By Commoditiescontrol Bureau; +91 98201 30172)
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