Palm drops more than 3pct as crude oil slumps on US-Iran ceasefire
08/04/2026 (Reuters), Kuala Lumpur - Malaysian palm oil futures tumbled more than three per cent on Wednesday, pressured by a sharp drop in crude oil prices following a US-Iran ceasefire deal.
The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange slid RM150, or 3.15 per cent, to RM4,615 (US$1,159.55) a metric ton by the midday break, extending losses to a third straight session.
Palm oil prices are currently tracking developments in the Middle East conflict closely, mirroring movements in crude oil prices, said Sandeep Singh, director of The Farm Trade, a Kuala Lumpur-based consulting and trading company.
Oil prices dived, stocks surged and the dollar was knocked back as the two-week Middle East ceasefire sparked a relief rally, fuelled by hopes that oil and gas flows through the Strait of Hormuz could resume.
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
Singh said palm oil prices were expected to find support at about RM4,500, underpinned by a possible B20 biodiesel mandate in Malaysia and lower inventory levels.
Malaysia plans to expand its palm-based B20 biodiesel programme nationwide in phases, taking into account the price sensitivity of palm oil relative to petroleum prices, the plantation and commodities minister said.
Dalian's most-active soyoil contract fell 2.73 per cent, while its palm oil contract shed 3.76 per cent. Soyoil prices on the Chicago Board of Trade were down 3.63 per cent.
Palm oil tracks the price movements of rival edible oils, as it competes for a share of the global vegetable oils market.
The ringgit, palm's currency of trade, strengthened 1.19 per cent against the dollar, making the commodity more expensive for buyers holding foreign currencies.
Palm oil may revisit its recent low of RM4,713 per ton, the ending point of a wave a from RM4,919, Reuters technical analyst Wang Tao said.