Palm Oil Market Watch: Technical Breakdown & Fundamental Shakeup
In the ever-changing landscape of the global vegetable oil market, palm oil takes center stage once again. From India’s sharp increase in imports to Indonesia’s biodiesel policy adjustments and Malaysia’s declining export figures, the palm oil market is witnessing a dynamic interplay of forces. On the technical front, critical price levels and trend shifts are adding layers of uncertainty and opportunity for market participants. This article delves into the latest developments and future outlook of the palm oil market through both fundamental and technical perspectives.
1. News and Fundamental Analysis
Anilkumar Bagani, head of research at the Mumbai-based vegetable oil brokerage Sunvin Group, stated that palm oil futures rebounded from earlier weakness because India, the world's largest edible oil importer, increased its palm oil purchases. India bought approximately 100,000 metric tons of palm oil during the first two working days of 2025.
Indonesia’s Deputy Minister of Energy and Mineral Resources, Yuliot Tanjung, announced on Friday that the country would provide a 1.5-month transition period for businesses to meet the new B40 biodiesel policy requirements. Initially, Indonesia planned to mandate a 40% palm oil content in biodiesel starting January 1, but industry stakeholders are still awaiting technical regulations for implementation.
Independent inspection company AmSpec Agri reported on Tuesday that Malaysia's palm oil product exports for November totaled 1,381,837 tons, a 2.5% decrease from November's 1,417,436 tons. Meanwhile, data from Intertek Testing Services (ITS) showed Malaysia’s palm oil product exports for December fell to 1,359,504 tons, down 7.8% from November's 1,473,761 tons.
Palm oil prices followed the trends of other competing edible oils as they vie for market share in the global vegetable oil market. In China, the most active soybean oil contract on the Dalian Commodity Exchange dropped by 2.56%, while the most active palm oil contract declined by 1.36%. The CBOT March soybean oil futures contract remained steady.
2. Technical Analysis
Malaysian BMD crude palm oil (CPO) futures rose on Friday but ended the week with a decline of over 5%, reversing gains from the previous week. The benchmark March CPO contract on BMD increased by RM41, or 0.95%, to RM4,374 per ton.
The weekly chart for the continuous contract FCPO1! shows that prices failed to hold the support level around RM4,500, instead falling to RM4,374. Despite losing the RM4,500 level, the overall upward trend structure remains intact on the weekly chart. The next support level is anticipated around RM4,120. If this level is also breached, it will be necessary to reassess whether the major trend has shifted from bullish to bearish.
On the daily chart for FCPO1!, the overall trend leans bearish. A clear double-top formation is evident, with a neckline break, resistance retest, and distinct downward waves. While support is visible around RM4,250, it is unlikely to be strong. Both the weekly and daily charts for the March contract indicate that RM4,250 does not represent a solid support level.
3. Summary
By referencing the March and continuous contracts, the next significant support level is likely between RM4,120 and RM4,150. Until this support range is breached, the overall trend can be described as long-term bullish with short-term bearish corrections.
1. News and Fundamental Analysis
Anilkumar Bagani, head of research at the Mumbai-based vegetable oil brokerage Sunvin Group, stated that palm oil futures rebounded from earlier weakness because India, the world's largest edible oil importer, increased its palm oil purchases. India bought approximately 100,000 metric tons of palm oil during the first two working days of 2025.
Indonesia’s Deputy Minister of Energy and Mineral Resources, Yuliot Tanjung, announced on Friday that the country would provide a 1.5-month transition period for businesses to meet the new B40 biodiesel policy requirements. Initially, Indonesia planned to mandate a 40% palm oil content in biodiesel starting January 1, but industry stakeholders are still awaiting technical regulations for implementation.
Independent inspection company AmSpec Agri reported on Tuesday that Malaysia's palm oil product exports for November totaled 1,381,837 tons, a 2.5% decrease from November's 1,417,436 tons. Meanwhile, data from Intertek Testing Services (ITS) showed Malaysia’s palm oil product exports for December fell to 1,359,504 tons, down 7.8% from November's 1,473,761 tons.
Palm oil prices followed the trends of other competing edible oils as they vie for market share in the global vegetable oil market. In China, the most active soybean oil contract on the Dalian Commodity Exchange dropped by 2.56%, while the most active palm oil contract declined by 1.36%. The CBOT March soybean oil futures contract remained steady.
2. Technical Analysis
Malaysian BMD crude palm oil (CPO) futures rose on Friday but ended the week with a decline of over 5%, reversing gains from the previous week. The benchmark March CPO contract on BMD increased by RM41, or 0.95%, to RM4,374 per ton.
The weekly chart for the continuous contract FCPO1! shows that prices failed to hold the support level around RM4,500, instead falling to RM4,374. Despite losing the RM4,500 level, the overall upward trend structure remains intact on the weekly chart. The next support level is anticipated around RM4,120. If this level is also breached, it will be necessary to reassess whether the major trend has shifted from bullish to bearish.
On the daily chart for FCPO1!, the overall trend leans bearish. A clear double-top formation is evident, with a neckline break, resistance retest, and distinct downward waves. While support is visible around RM4,250, it is unlikely to be strong. Both the weekly and daily charts for the March contract indicate that RM4,250 does not represent a solid support level.
3. Summary
By referencing the March and continuous contracts, the next significant support level is likely between RM4,120 and RM4,150. Until this support range is breached, the overall trend can be described as long-term bullish with short-term bearish corrections.
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