Malaysian palm oil exports climbed by more than a quarter m-o-m in March as demand from India, Europe and Africa picked up once again following a relatively slow month in February. India has been the main driver as demand (primarily for edible purposes) preceding the Ramadan festival (23rd April), and Eid al-fitr (23rd May) has always been historically strong. India has likely had to compensate for weaker imports in February, where overall Malaysian palm oil exports fell 8.2% m-o-m, to meet demand ahead of the festivals.
On the supply side, palm oil prices rose mirroring gains in soyabean oil, following the USDA’s prospective planting survey revealing a smaller-than-expected forecast for soyabean planting. The USDA projects 2021 soyabean acreage at 87.6 million, which fell short of industry expectation of 89.9 million and the USDA’s Outlook Farm estimate of 90 million.
The combination of these supply and demand factors caused Malaysian crude palm oil prices to stabilise after three consecutive weeks of decreases. Prices have held at MYR 3,572/MT since 30th March. Looking forward, Malaysian exports are expected to slightly increase in April, fuelled by resilient demand from the same regions that supported March exports.