Benchmark palm oil futures on the Bursa Malaysia Derivatives Exchange opened stronger this week, with the January contract up around 14 ringgit, or 0.31 percent, to 4,526 ringgit a tonne. The move followed overnight strength in soyoil and crude oil, both key drivers of sentiment across the broader vegetable oils complex. Palm often tracks soyoil, given their overlap in export markets and use in food manufacturing and biodiesel production.
Rising crude prices have re-energised biofuel demand, which directly supports palm oil consumption. The higher the cost of fossil fuels, the more attractive palm oil becomes as an input for biodiesel blending.
The ringgit’s slight appreciation against the US dollar, around 0.14%, has moderated some of the upside. A firmer currency makes Malaysian exports marginally more expensive for overseas buyers, but the broader narrative remains supportive. Market participants are also weighing evidence that inventories may ease over the coming months, with production slowing into year-end and exports expected to remain steady.
Buyers in India and China are reportedly looking to rebuild stockpiles after months of cautious purchasing. Lower relative pricing compared to rival oils could re-ignite interest, particularly if soyoil remains firm.
Dekel Agri-Vision PLC (LON:DKL) aspires to become a leading agro-industrial company in West Africa, one that creates value for shareholders whilst at all times placing the interests of the local communities and environment in which it operates in at the heart of its operations.
