Malaysian palm oil futures recovered on Tuesday as crude oil and soybean oil prices rose, and as strong exports and higher Indian demand provider further upside.
Ending a two-session loss, the Bursa Malaysia Derivatives' September crude palm oil contract climbed 0.72% to 4,622 Malaysian ringgit ($1,128.69) per metric ton. The October contract firmed 0.84% to 4,668 ringgit/mt.
India's edible oil imports reached their highest level in 10 months in July as buyers scaled up purchases ahead of festivities, with dealers cited by Reuters estimating a 50% month-over-month jump in palm oil imports to 733,000 metric tons and a 32% growth in soybean imports to 501,000 mt.
Indian buyers have reportedly started rebuilding inventories to meet peak demand during the upcoming festival season, occurring between August and November, the news agency reported, citing Sunvin chief executive Sandeep Bajoria.
Robust exports from top producing regions also lifted prices. Indonesia recorded a year-over-year increase in its H1 exports of crude and refined palm oil to 11.3 million metric tons, compared with the 2025 level of 11.0 mmt, data from the statistics bureau showed.
In July, however, exports posted a year-over-year drop to 2.4 mmt from 2.7 mmt, with analysts projecting a further decline in the coming months as a higher biodiesel blending of 50% progresses.
In Malaysia, cargo surveyors reportedly estimated July shipments to have risen between 12.1% and 19.5% from a month earlier, while a Reuters survey showed a 14.8% growth.
However, the survey also indicated a 7.4% month-over-month increase in production, resulting in a buildup in inventories, which likely reached a five-month high during the period.
Stocks could begin declining once the peak production season ends in Q4 and when a developing El Nino weather phenomenon starts to impact yields, providing price support in the forward months.