Global Palm Oil Use Seen Rising on Softer Prices

05-Dec-2025 03:53 PM

Singapore. A leading rating agency predicts a comfortable balance between demand and supply in the edible oil market in the coming months, which could put pressure on crude palm oil (CPO) prices in 2026.

According to the rating agency, the average price of crude palm oil in 2026 is expected to range between 3,850 and 4,250 ringgit per tonne, lower than the 2025 average price of 4,300 ringgit per tonne.

Favorable weather conditions in major palm oil producing and exporting countries, improved average yields, and a gradual return to normal global edible oil production are expected to moderate or stabilize prices for this important vegetable oil.

According to the rating agency, the average CPO price will remain slightly higher in 2025 due to increased biodiesel consumption and a weak US dollar. Additionally, a rise in the prices of other edible oils also provided some support to CPO.

Global consumption of palm oil, along with other edible oils, is expected to increase through 2026. The US Department of Agriculture has projected an increase in palm oil consumption, but it expects consumption to be slightly lower than production, leading to a slight increase in outstanding stocks.

According to the rating agency, India, a top importer, will continue to maintain strong palm oil purchases next year as the export offer price of palm oil is expected to remain competitive compared to other competing edible oils such as soybean oil, sunflower oil,

and rapeseed and canola oil. The Food and Agriculture Organization (FAO), a UN agency, has projected a 2.1 percent increase in total global consumption of oils and fats in 2026 compared to 2025.