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2025-12-12 18:19:18
[Surge in Inventories Overwhelms Market, Palm Oil Prices Break Key Support] ⑴ The recent decline in palm oil prices is primarily driven by market concerns about high inventory levels. A research report from Hong Leong Investment Bank indicates that Malaysian palm oil inventory levels continued their upward trend in November, increasing significantly by 13% month-on-month. ⑵ The report analyzes that while seasonal production declines and increased domestic consumption were beneficial to inventory levels, this was completely offset by a sharp drop in exports, ultimately leading to an increase in inventory levels. ⑶ The bank expects inventory levels to gradually decline in the coming months, but the current high inventory reality is putting direct pressure on prices. ⑷ Market trading data confirms this pessimistic sentiment; the February delivery palm oil futures contract on the Bursa Malaysia Derivatives Exchange fell 45 ringgit to close at 4,018 ringgit per tonne. ⑸ The interplay between inventory and exports remains the core driver of short-term prices; the market needs to wait for substantial improvement in export data to effectively reverse the current downward trend.
