<\/p>\n
Palm oil climbed to its highest level in about 20 months, as rising biofuel demand and mounting production risks from the strengthening El Ni\u00f1o underpin prices.<\/p>\n
Indonesia, the world\u2019s largest producer, recently started its ambitious B50 biofuel mandate, which is poised to funnel more of the crop into fuel and curb the country\u2019s exports.<\/p>\n
In addition, a dry spell has recently hit farmers there and in No. 2 grower Malaysia. The El Ni\u00f1o weather pattern is known for bringing dryness to much of Southeast Asia, weighing on production of the tropical oil. The US Department of Agriculture forecast global palm oil reserves to fall to a nine-year low in the 2026-27 season.<\/p>\n
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Futures in Kuala Lumpur rose as much as 0.7% to 4 927 ringgit a ton on Thursday, the highest intraday level since December 2024. The rally comes as other key crop staples, including corn and sugar, are also climbing, potentially lifting food inflation.<\/p>\n
Recent attacks in the Black Sea have also slowed crop exports from Russia and Ukraine to a trickle. The countries are major sunflower oil suppliers, and buyers are turning to rival vegetable oils to help fill the gap.<\/p>\n
The high on Thursday was \u201ctechnically a breakout point,\u201d said Gnanasekar Thiagarajan, head of trading and hedging strategies at Kaleesuwari Intercontinental. However, several factors could cap prices from rallying further, including a strengthening ringgit and competitive soy oil prices, he added.<\/p>\n
\u00a9 2026 Bloomberg<\/p>\n
#Palm #oil #hits #highest #biofuels #Ni\u00f1o #cut #supply<\/p>\n","protected":false},"excerpt":{"rendered":"
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