May 26, 2023 (MLN):Â Malaysian palm oil rose on Friday, due to concerns over unfavorable EL Nino weather patterns.
The benchmark palm oil contract rose by 0.71% to 3518 ringgit a tonne.
Palm oil benchmark found some supporting ground around the 3350 ringgit area, and is up by 1.06% this week.
Malaysian Palm Oil Board (MPOB) on Friday stated that crude palm oil production in Malaysia, the world’s second-largest producer, could drop between 1 and 3 million tonnes next year as a result of the El Nino weather pattern.
According to cargo surveyor Intertek Testing Services, exports of Malaysian palm oil products for May 1-25 fell by 0.7% MoM from the earlier corresponding month.
However, another cargo surveyor, AmSpec Agri Malaysia, stated that exports rose by 0.7%.
The ringgit MYR, palm’s trading currency with respect to the U.S. dollar is down by 1.73% this week, marking a decline for the third consecutive week.
This makes the commodity cheaper for buyers holding foreign currency.
Moreover, palm oil is also affected by price movements in related oils as they compete for a share in the global vegetable oils market.
