According to spot market data from SunSirs, palm oil market performance weakened in April, with prices fluctuating downward and recording a decline of over 1%. At the beginning of the month, the average market price for palm oil stood at 9,750 RMB/ton; by April 28, the average price had fallen to 9,644 RMB/ton—a decrease of 1.09%.

The primary factors influencing palm oil market trends in April were as follows:

Supply Side: Malaysian palm oil entered a production growth cycle amidst sluggish export performance, resulting in a weakening of market fundamentals. From April 1 to April 20, Malaysian palm oil production increased by 17.52% month-on-month, marking the onset of a seasonal production surge characterized by simultaneous increases in both yield per hectare and oil extraction rates; consequently, supply-side pressure intensified. During the period of April 1 to April 25, Malaysian palm oil export volumes declined by 15.7% to 16.8% compared to the previous month. Weak demand from major importing nations—coupled with high prices dampening purchasing activity—led to a "collapse" in exports, thereby elevating the risk of inventory accumulation.

Domestic inventories remained elevated while demand remained sluggish, thereby limiting the potential for a price rebound. Although port inventories saw a slight drawdown, they remained at historically high levels; meanwhile, while import arrivals proceeded normally, domestic purchasing remained cautious.

Crude Oil: Recurring geopolitical uncertainties rendered energy-related market support "strong yet unstable." Regarding the Middle East situation—specifically the intermittent nature of U.S.-Iran negotiations and disruptions to shipping traffic in the Strait of Hormuz—crude oil price volatility intensified, causing the energy premium associated with palm oil to fluctuate in tandem with oil prices.

Demand: Demand from the catering and food processing sectors remained weak. Furthermore, increased substitution by soybean oil and rapeseed oil served to dampen overall palm oil consumption.

Import Costs: Import margins remained inverted (unprofitable), thereby restricting import volumes; however, this factor proved insufficient to alleviate the prevailing pressure from high domestic inventory levels.

Weather and Forward Expectations: The El Niño phenomenon emerged as the "last straw" for market bulls. Following March, precipitation levels in Southeast Asia trended lower than usual; consequently, market expectations now anticipate the potential onset of a moderate-intensity El Niño event between June and August—a development that could negatively impact production yields during the second half of the year.

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