Malaysian palm oil futures were trading below the MYR 3,800 per tonne mark, close to levels not seen since October 2022, pressured by a stronger ringgit and worries about weak demand. Exports from Malaysia, the world’s second-largest producer, during January 1-20 slumped between 29% and 38% from the same period in December, as shipments to India and China slowed, cargo surveyors’ data showed.
On top of that, Malaysia has recently warned that it could stop exporting palm oil to the EU in retaliation to a new law aimed at protecting forests through strict palm oil sales regulation. On the supply side, Ivy Ng, regional head of plantations research at CGS-CIMB Research, projected Malaysia’s output to rise 3.3% to 19.1 million tonnes this year as labor shortage issues would likely ease in mid-2023.