Palm oil futures remained above RM2,750 per tonne in the first week of December, a level not seen since January on the back of lower than expected production and tightening supply along with strong demand from India and China. Malaysia’s FGV Holdings Bhd, the world’s largest producer of crude palm oil, said production in 4Q FY2020 will be impacted by weather uncertainties and partial lockdown in Sabah. At the same time, the Malaysian Palm Oil Association said Malaysia could lose almost 25% of its output due to a labour shortage, leaving further room for upside momentum. Still, Indian edible oil refiners are trimming imports of palm oil in November and December to make space for soyoil as a recent rally in the price of palm reduced the spread between the two oils.
