← Crude Palm Oil overview

Crude Palm Oil vs US Dollar/Malaysian Ringgit FX Spot Rate: why the prices moved differently

Weekly · monthly · quarterly news summaries, side by side in time

Crude Palm Oil (PALMOIL.COMM)

Q3 2026
▲3▼1

Palm oil climbs on India demand, Thai biofuel, El Niño supply threat

  • India festival buying and import tax cut India's festival buying and a cut in its crude palm oil import tax from 10% to 5% boosted demand from the world's largest buyer, supporting prices.

    This demand boost from India was a key bullish force during the period.

  • Thailand biofuel policies support demand Thailand's B20 subsidies and biodiesel/bio-jet promotion kept domestic demand firm, with farm-gate prices strong for 25 straight weeks.

    Thai biofuel policies added steady demand support for palm oil.

  • El Niño and wildfires threaten supply A 95% probability super El Niño and Indonesian wildfires damaging over 200,000 hectares threatened Southeast Asian output, tightening supply.

    Supply threats from El Niño and fires pushed prices higher.

  • Delayed harvests and future capacity expansions El Niño delayed harvests, raising processor costs for PHAT and SMO, while PCE and PHAT mill capacity expansions will add future supply and could cap price gains.

    These factors acted as counterweights that limited price increases.

August 2026
▲3▼1

Palm oil climbs on India demand, Thai biofuel, El Niño supply threat

  • India festival buying and import tax cut India's festival buying and a cut in its crude palm oil import tax from 10% to 5% boosted demand from the world's largest buyer, supporting prices.

    This demand boost from India was a key bullish force during the period.

  • Thailand biofuel policies support demand Thailand's B20 subsidies and biodiesel/bio-jet promotion kept domestic demand firm, with farm-gate prices strong for 25 straight weeks.

    Thai biofuel policies added steady demand support for palm oil.

  • El Niño and wildfires threaten supply A 95% probability super El Niño and Indonesian wildfires damaging over 200,000 hectares threatened Southeast Asian output, tightening supply.

    Supply threats from El Niño and fires pushed prices higher.

  • Delayed harvests and future capacity expansions El Niño delayed harvests, raising processor costs for PHAT and SMO, while PCE and PHAT mill capacity expansions will add future supply and could cap price gains.

    These factors acted as counterweights that limited price increases.

Latest
▲3

Palm oil supported by biofuel demand, tight supply, India tax cut

  • India cuts palm oil import tax, boosting demand India cut its import duty on crude palm oil from 10% to 5%, making it cheaper to buy ahead of festivals. India buys most of its cooking oil from abroad, so this directly lifts demand for palm oil and supports higher prices.

    This is a fresh, concrete demand boost from the world's biggest palm oil buyer.

  • Indonesian wildfires threaten palm supply Wildfires in Indonesia, the largest palm oil producer, have damaged over 200,000 hectares and are disrupting harvesting. Smoke and dry weather may hurt fruit yields, tightening global supply and pushing crude palm oil prices up.

    A major supply threat in the top producer is a key force behind higher palm oil prices.

  • Biofuel policy keeps palm oil demand strong Thailand's government is promoting palm oil as an energy crop for biodiesel and future bio jet fuel, creating steady domestic demand. This has kept farm-gate palm prices strong for 25 straight weeks, supporting crude palm oil prices.

    Government biofuel support is a persistent demand driver keeping palm oil prices elevated.

  • El Nino cuts output now, but expansion adds future supply El Nino delayed palm harvests, cutting raw material supply and raising costs for processors like PHAT and SMO. At the same time, PCE and PHAT are expanding mill capacity, which will add supply later and could cap price gains.

    It shows both the current supply tightness lifting prices and the counterweight of future capacity growth.

▲4

Palm oil climbs on festival demand, biofuel policy, and El Niño supply fears

  • India's festival buying spree lifts palm oil demand India's July vegetable oil imports hit a 10-month high, with palm oil jumping 50% to 733,000 tonnes as refiners stock up for the August-November festival season. This strong demand from the world's biggest buyer helps draw down stocks in Indonesia and Malaysia, supporting prices.

    This is a major new demand event that directly tightens global palm oil inventories and pushes prices up.

  • Thailand's B20 subsidy and EV loan boost palm oil use Thailand's Finance Ministry will use a 200 billion baht loan to subsidize public vehicles switching to EVs and to support B20 fuel, which contains more palm oil. This policy increases domestic palm oil demand, helping farmers and supporting prices.

    A new government policy that directly raises palm oil consumption, adding to demand-side price support.

  • Super El Niño threat could cut Southeast Asian palm output The probability of a super El Niño has risen to 95%, which would bring drought to Southeast Asian palm oil regions and lower production. Reduced supply would tighten the market and push prices higher, as traders factor in a weather premium.

    A new supply-side risk that could significantly reduce palm oil output and drive prices up.

  • SMO expands capacity and sees strong Q3 on higher exports Thai palm oil producer SMO reported higher revenue and expects Q3 recovery from increased crude palm oil exports as exchange rates stabilize. It is also investing 130 million baht in a new palm kernel oil plant, signaling confidence in future demand and supporting market sentiment.

    New company-level signals of rising exports and capacity expansion reinforce the positive demand outlook for palm oil.

US Dollar/Malaysian Ringgit FX Spot Rate (USDMYR.FOREX)

Q3 2026
▲2▼2

Ringgit's AI-export strength vs Middle East risk and equity outflows

  • Strong growth and AI exports support the ringgit Malaysia's economy grew 5.7% in the first half of 2026, and Goldman Sachs says the AI investment boom is boosting ringgit-linked exports and foreign investment. A stronger economy pulls money into Malaysia, so the ringgit strengthens and USDMYR falls.

    This is the main force pushing the ringgit stronger and USDMYR lower.

  • Middle East conflict and risk-off sentiment lift the dollar Renewed US-Iran tensions and broader risk-off sentiment have pushed investors toward the US dollar, weakening the ringgit. The Middle East conflict also raises oil and commodity prices, which adds to Malaysia's inflation risk and keeps the ringgit under pressure.

    This is the main force pushing USDMYR higher.

  • Central bank holds rate, but a future hike could support the ringgit Bank Negara Malaysia kept its policy rate at 2.75% for a seventh straight meeting, as expected. Because inflation is expected to stay high from Middle East energy costs, the market sees a possible rate hike in January 2027, which would make the ringgit more attractive and push USDMYR down.

    Monetary policy is a key driver of currency strength, and the possibility of a hike supports the ringgit.

  • Foreign equity outflows weaken the ringgit Foreign investors have been selling Malaysian stocks, pushing USDMYR up to 4.07 for a fourth straight session of ringgit weakness. However, the central bank's cautious stance on inflation limits how much further the ringgit can fall.

    Portfolio outflows are a direct, current drag on the ringgit.

August 2026
▲2▼2

Ringgit's AI-export strength vs Middle East risk and equity outflows

  • Strong growth and AI exports support the ringgit Malaysia's economy grew 5.7% in the first half of 2026, and Goldman Sachs says the AI investment boom is boosting ringgit-linked exports and foreign investment. A stronger economy pulls money into Malaysia, so the ringgit strengthens and USDMYR falls.

    This is the main force pushing the ringgit stronger and USDMYR lower.

  • Middle East conflict and risk-off sentiment lift the dollar Renewed US-Iran tensions and broader risk-off sentiment have pushed investors toward the US dollar, weakening the ringgit. The Middle East conflict also raises oil and commodity prices, which adds to Malaysia's inflation risk and keeps the ringgit under pressure.

    This is the main force pushing USDMYR higher.

  • Central bank holds rate, but a future hike could support the ringgit Bank Negara Malaysia kept its policy rate at 2.75% for a seventh straight meeting, as expected. Because inflation is expected to stay high from Middle East energy costs, the market sees a possible rate hike in January 2027, which would make the ringgit more attractive and push USDMYR down.

    Monetary policy is a key driver of currency strength, and the possibility of a hike supports the ringgit.

  • Foreign equity outflows weaken the ringgit Foreign investors have been selling Malaysian stocks, pushing USDMYR up to 4.07 for a fourth straight session of ringgit weakness. However, the central bank's cautious stance on inflation limits how much further the ringgit can fall.

    Portfolio outflows are a direct, current drag on the ringgit.

Latest
▲2▼2

Ringgit's AI-export strength vs Middle East risk and equity outflows

  • Strong growth and AI exports support the ringgit Malaysia's economy grew 5.7% in the first half of 2026, and Goldman Sachs says the AI investment boom is boosting ringgit-linked exports and foreign investment. A stronger economy pulls money into Malaysia, so the ringgit strengthens and USDMYR falls.

    This is the main force pushing the ringgit stronger and USDMYR lower.

  • Middle East conflict and risk-off sentiment lift the dollar Renewed US-Iran tensions and broader risk-off sentiment have pushed investors toward the US dollar, weakening the ringgit. The Middle East conflict also raises oil and commodity prices, which adds to Malaysia's inflation risk and keeps the ringgit under pressure.

    This is the main force pushing USDMYR higher.

  • Central bank holds rate, but a future hike could support the ringgit Bank Negara Malaysia kept its policy rate at 2.75% for a seventh straight meeting, as expected. Because inflation is expected to stay high from Middle East energy costs, the market sees a possible rate hike in January 2027, which would make the ringgit more attractive and push USDMYR down.

    Monetary policy is a key driver of currency strength, and the possibility of a hike supports the ringgit.

  • Foreign equity outflows weaken the ringgit Foreign investors have been selling Malaysian stocks, pushing USDMYR up to 4.07 for a fourth straight session of ringgit weakness. However, the central bank's cautious stance on inflation limits how much further the ringgit can fall.

    Portfolio outflows are a direct, current drag on the ringgit.