Malaysian palm oil futures were trading above the MYR 4,200 per tonne mark in early January, a level not seen in more than a month, supported by expectations of lower production and tighter supplies from rivals. Indonesia, the world’s biggest palm oil producer, announced that palm oil producers can now export only six times the domestic sales requirement as it wants to ensure ample domestic supplies. On top of that, Indonesian officials anticipated weaker seasonal production in Q1 of 2023 while extending a policy to allow imports of vegetable oils such as palm oils. Keeping a lid on prices were prospects of weak export demand from Malaysia, with shipments in December likely falling between 1.7% and 2.8% from the prior month, cargo surveyors said. Palm oil lost over 10% in a rollercoaster 2022 that saw the benchmark hit a record high of MYR 7,300 in March as Russia’s invasion of Ukraine tighten the supply of edible oils.
