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Palm oil prices slipped for a second straight week, with Malaysia’s key contract down 0.65% by midday Friday as currency shifts made exports pricier and cautious traders waited for direction.
What does this mean?
Contracts for palm oil on the Bursa Malaysia Derivatives Exchange have been stuck between 4,400 and 4,500 ringgit per metric ton lately, dropping 1.57% this week even as other oilseeds made small gains in China. A weaker soyoil market in Chicago and lower crude oil prices have left edible oil markets feeling tentative, while US sanctions have stitched in some longer-term doubts for energy supply. Meanwhile, the ringgit’s slight move up against the US dollar has nudged Malaysian palm oil prices higher for international buyers, making it even less competitive. Cooler crude oil prices also mean there’s less incentive to use palm oil in biodiesel, further weighing on demand. Still, chart watchers say breaking above resistance at 4,471 ringgit could shift things, pointing to a possible rally if that price level is cleared.
Palm oil and other edible oils are fighting for global market share, so every twist in prices, currency moves, or energy policy sparks new trading strategies. This week’s narrow range and the broader cautious tone show traders are keeping their powder dry for now. If technical resistance breaks, expect a rapid pickup in trading activity and price swings.
The bigger picture: Food and energy markets move together now more than ever.
Edible oils like palm oil are central to both food and fuel supply chains. With US sanctions raising questions over energy markets, swings in commodity currencies, and changing demand for biofuels, movements in one sector quickly spread to others. For big food companies and major buyers, a stronger ringgit and volatile supply mean nimble sourcing is more important than ever.
