Malaysia palm oil future prices fell sharply in Friday, BMD ended the week at 2148 down by 76 points from the previous week’s close. Weak fundamentals and continues slow export demand keep palm prices under pressure. The production is estimated higher, the ending stocks are set to increase while the exports might decline.
Production is expected to rise on a seasonal uptrend. Exports of palm oil fell 20 per cent in Malaysia in the first 25 days of October. Stocks will rise due to rising production of palm oil in Malaysia and fall in exports from Malaysia in October. EU and India were buyers which imported lower amount of palm oil.
India is importing less palm oil due to higher imports the of palm oil in August and September which has increased port stocks. Further, stocking for the festive season is over and there are no fresh triggers of demand in the near term. Depreciation of Rupee has dented imports. Along with this competing oil like CBOT soy oil is expected to be under pressure by oversupply scenario. Continuous selling in various asset classes globally has also led to fall in palm oil prices.
However, in today’s session prices are correcting after continues four sessions of losses and weak Ringgit and local high price may support prices for the session.