Malaysian palm oil futures jumped by more than 8% to MYR 3,900 per ton in the third week of July, edging up from an over 1-year low of MRY 3,500 hit last week supported by higher soyoil prices and as investors had factored in Indonesia’s move to lift its export levy. The world’s biggest producer over the weekend removed a levy on exports of the vegetable oil until August 31st attempting to export 6 million tonnes of palm oil to boost exports and lower domestic stock levels.
Indonesia’s move was already expected as the government has indicated its plans to cut the levy since July 6th and has been taking measures to clear the current high palm oil stocks. Elsewhere, industry research group CGS-CIMB expects Malaysian palm oil stocks to rise by 21.4% monthly to 2 million tons in July, supported by higher production and lower exports.