Global market price of palm oil expected to remain stable in the coming months

07-Jul-2025 10:50 AM

Mumbai. Despite strong demand from major importing countries like India and China, global palm oil prices are likely to remain stable within a certain range during the second half of 2025.

This is mainly due to expected increases in production and surplus stock in leading producer and exporter nations such as Indonesia and Malaysia.

According to a leading research firm, global palm oil production during the 2025–26 marketing season is expected to reach a record 806 lakh tonnes, marking a 2.4 percent increase over the previous season.

Indonesia’s output is projected to rise by 3.3 percent to 475 lakh tonnes, while Malaysia’s production is expected to improve by 0.5 percent to 195 lakh tonnes.

Additional production will come from other countries, including Thailand. This will ensure a comfortable global supply situation.

The research firm has projected the average futures price of Malaysian crude palm oil (CPO) on the Bursa Malaysia Derivatives (BMD) Exchange,

Kuala Lumpur, to be around 4150 ringgit per tonne for the full year of 2025. For the second half of the year (June–December), prices are expected to hover between 3800 and 4000 ringgit per tonne.

CPO prices were higher in the first quarter of 2025, leading to a significant drop in imports, particularly in India. However, after April, a mild correction in prices encouraged higher imports in May and June.

It is noteworthy that the Malaysian Palm Oil Board (MPOB) estimated a 6 percent rise in CPO production during January–March 2025. Additionally, production in Malaysia rose by 7.8 percent to about 35 lakh tonnes during April–May, increasing inventories and putting some downward pressure on prices.