Kuala lumpur: The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives (BMD) concluded the trading session on a lower note Thursday, as profit-taking activities intensified following recommendations by an Indonesian industry group to postpone the B50 biodiesel mandate.

According to BERNAMA News Agency, the Indonesian Palm Oil Association pointed to supply constraints, emphasizing that fulfilling the 50 percent palm oil blend requirement would necessitate a significant increase in CPO production. This increase could potentially divert supplies from the export market, subsequently diminishing revenue derived from export taxes that fund the biodiesel program.

The B50 mandate is part of a national strategy designed to reduce fuel imports and decrease carbon emissions. It mandates a 50 percent blend of palm oil-based biodiesel with traditional fossil diesel fuel.

Mumbai-based Sunvin Group commodity research head Anilkumar Bagani remarked that the market was further affected by losses in rapeseed oil futures on the Zhengzhou Commodity Exchange, alongside weaker palm oil and soybean oil futures in China. He also noted that the stronger Malaysian ringgit had exerted additional pressure on ringgit-denominated prices.

Anilkumar further observed that any delay in the implementation of the B50 mandate would significantly reduce bullish sentiment in the palm oil market.

Palm oil trader David Ng added that market sentiment was additionally dampened by concerns over weak demand in the forthcoming weeks, following the recent price rally and seasonally high production levels. He indicated that prices are expected to find support at RM4,350 per tonne, with resistance at RM4,450 per tonne.

At the close of the session, the spot-month August 2025 and September 2025 contracts each declined by RM29 to RM4,338 per tonne and RM4,358 per tonne, respectively. The October 2025 contract decreased by RM32 to RM4,403 per tonne. The November 2025 contract dropped by RM34 to RM4,436 per tonne, December 2025 fell RM39 to RM4,450 per tonne, and January 2026 saw a decline of RM35 to RM4,451 per tonne.

Trading volume decreased to 88,920 lots from 97,321 lots on Wednesday. However, open interest increased to 244,194 contracts from 236,360 contracts the previous day. Meanwhile, the physical CPO price for August South decreased by RM20 to RM4,370 per tonne.