Global palm oil prices have seen a moderate uptick since our last update a week ago. This increase is attributed to the rise in prices of competitive vegetable oils as well as robust Malaysian palm oil export figures. A comparison from this month (1-31 Oct 2023), to last month (1-30 Sep 2023) in export growth in metric tonne from Malaysia: AMSPEC reported an 8.86% increase (1,345,051 vs 1,235,560), whereas ITS marked a 6.58% growth (1,384,725 vs 1,299,187).
The latest pricing data reveals:
- The Malaysian crude palm oil spot settlement price on the BMD as of 30th October 2023 stood at €721 or $762 per metric tonne, a slight increase from the €712 or $755 recorded on 25th October 2023.
- On a similar note, the Vesper West E.U. Forward Price Index for Crude Palm Oil, as of 30th October 2023, reached €880 or $930 per metric tonne (CIF Rotterdam, Jan). This is a marginal increase from the €875 or $925 quoted on 25th October 2023.
- The Vesper West E.U. Forward Price Index for Crude Palm Kernel Oil recorded on 30th October 2023 was €873 or $923 per metric tonne (CIF Rotterdam, JF), a minimal increase from the €872 or $922.5 on 25th October 2023.
However, this growth in pricing was somewhat curtailed by several factors. A strengthening of the Malaysian Ringgit played a notable part. The USD to MYR exchange rate on 30th October 2023 was 4.7580, compared to 4.7765 just five days prior. Additionally, a decline in Brent Crude oil prices further impacted the palm oil market. The Brent Crude Oil price on 30th October 2023 was $87.5 per barrel, down from $90 on 25th October 2023 (see Figure 1).
Figure 1: Brent crude oil price trend for December 2023 (USD per barrel)
Switching focus to Indonesia, the nation’s palm oil exports for August, which includes refined products, reported a significant drop. The exports stood at 2.07 million metric tonnes, a steep decline of 55% year-on-year. Crude palm oil production for the month of August was 3.86 million metric tonnes, down from 4.36 million metric tonnes in July. Despite this decrease in production and exports, domestic stock levels at the end of August saw a slight increment, reaching 3.24 million metric tonnes.
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