MDEX: Palm oil follows the decline in oil prices and closes lower.

The July contract of palm oil closed the session this Thursday (25) with a moderate drop of 0.86% in Malaysian Derivatives Exchange (MDEX)The price for corn is quoted at US$1,096.75/ton. The August contract fell 1.01% to US$1,102.00/ton. So far this week, futures have accumulated losses of 1.35% and 1.48%, respectively. 

In this trading session, commodity prices followed the negative performance of oil prices in the international market, after reports that at least 20 million barrels of fuel passed through the Strait of Hormuz in the last 24 hours. 

Lower fuel prices on the international market make palm oil a less attractive option as a feedstock for biodiesel.

Furthermore, prices were also pressured by the 1.81% decline in palm oil in Dalian Exchange (DCE)Meanwhile, soybean oil fell 0.37% on the Chinese index.

By limiting further losses, independent cargo inspection companies in Malaysia, Intertek Testing Services and AmSpec Agri MalaysiaThey projected that exports of palm oil derivatives from the country advanced between 10.6% and 11.1%, respectively, during the period from June 1st to 25th. 

In Indonesia, as reported by Reuters, citing an official from the country's Ministry of Energy, the government has already issued regulations implementing its mandate to increase the blend of palm oil-based biodiesel in diesel (B50) to 50%.

The source also told the publication that a deadline of up to 3 months has been set for retailers to liquidate current inventory.

This text was translated by machine from Brazilian Portuguese.