After May 1, the main palm oil contract reached a new low of 4,930 yuan/ton and then went up. At present, it is running to 5,100 yuan/ton. The current round of rebound was mainly boosted by rising crude oil prices, oil-to-hears ratio repairs, short oil funds, and exits. It is expected that palm oil prices will oscillate in the short term, but given the fundamentals are still unsatisfactory, there is a limit to how much room is needed.

　　April Malaysia's production and inventory are lower than expected

　　Last week, the data released by the Malaysian Palm Oil Board showed that in April, palm oil production in Malaysia was 1.56 million tons, which was 1% lower than in March, which was lower than the market forecast of 1.57 million tons; the export volume was 1.54 million tons, compared with March. It fell 1.6%, lower than the market forecast of 1.48 million tons; inventory was 2.17 million tons, down 6.4% from the end of March, lower than the market's forecast of 2.23 million tons. In April, production and inventories were both lower than expected, and the report was relatively high, boosting palm oil prices.

　　Biodiesel consumption is expected to increase

　　Year to date, crude oil prices tend to be strong. Recently, the United States announced its withdrawal from the Iranian nuclear agreement. The market feared that crude oil supply was affected and prices continued to rise. The price of palm oil in vegetable oil is relatively low. During the rise of crude oil prices, palm oil was the first biodiesel profit. The market has begun to pay attention to the improvement of palm oil consumption.

　　The Indonesian and Malaysian governments all support biodiesel from palm oil, which imposes an injunction on the ratio of biodiesel to gasoline: Malaysia is added at 7% and Indonesia is at 20%. Crude oil prices continue to rise, and profits from biodiesel have increased. Even without government enforcement measures, biodiesel consumption will increase.

　　Oil and gas ratio has been repaired

　　In early May, the price of oysters fell, oil prices rebounded, and the oil to oil ratio was restored. After the Spring Festival, due to the favorable stimulation of Argentine drought and US soybean planting area, there was a rapid rise in the price of soybean meal, while palm oil production recovered rapidly, and domestic vegetable oil thrown into storage resulted in pressure on oil prices, and the oil/tank ratio continued to fall. Recently, the domestic soybean meal bulge, Brazilian real and the Argentine peso have depreciated, and soybean meal prices have retraced. At present, soybean meal gradually returns to fundamentals, US soybean weather speculation is too early, lack of confidence in funds to do more, do more types of urine, short-sighted oil funds leave, so that grease is supported.

　　Seasonal increase cycle arrives

　　In the first three months of this year, palm oil production in Malaysia was at a historical high. Historical data shows that palm oil production generally continues to increase from March until peaking in October. At present, palm oil is in a seasonal increase cycle. In addition, due to El Niño's impact in 2016, global palm oil production declined. Last year, production began to recover. Although this year's output growth has declined, it is expected to increase by 2% to 3% throughout the year.

　　India's import tariffs are at the highest level in 10 years

　　India is the world's largest importer of palm oil. In order to protect the interests of its own farmers, the government has continuously increased the import tariffs on palm oil in the past two years. The current tariffs are at the highest level in 10 years, which has hit the import enthusiasm of traders.

　　In general, the strong crude oil prices and the oil-to-hearing ratio have some support for palm oil prices. In the short-term, it is expected to continue the rebound pattern. However, the supply of palm oil is flawless and the demand is not optimistic. The rebound is expected to be limited.