Palm Oil Futures Prices Expected to Remain Elevated in the Near Future

07-May-2026 12:27 PM

Singapore. Dorab Mistry—an internationally renowned analyst in the vegetable oil industry and trade sector, and a Director at Godrej International—has stated that the futures price of Malaysian Crude Palm Oil (CPO) could rise to 5,000 Ringgit per tonne by June 2026, and subsequently recover to reach 5,200 Ringgit per tonne in July. It is noteworthy that Dorab Mistry is among the select few analysts whose views are listened to with great attention and whose predictions often exert a profound influence on global market prices for edible oils.

Last week, the global market price for crude mineral oil surged to $126 per barrel—its highest level in four years. Consequently, there is a heightened emphasis across various nations on increasing the utilization of vegetable oils in the production of biofuels. The price differential between fossil diesel and palm biodiesel has narrowed significantly. This presents governments with an opportunity to reduce subsidies. In some countries, palm biodiesel has now become even cheaper than fossil or conventional diesel.

Indonesia has decided to implement the 'B50 Program' effective July 1, 2026, under which it will become mandatory to utilize 50 percent palm oil in the production of biodiesel. Concurrently, several other nations—including Malaysia and Thailand—are also moving toward increasing the use of palm oil in their biodiesel production initiatives. Indonesia stands as the world's leading producer and exporter of palm oil. While the 'B40 Program' is currently in effect there, the 'B50 Program' is expected to become operational starting July 1.

In the global market, palm oil competes primarily with soybean oil; the prices of the latter have witnessed a substantial uptick in recent weeks as top-producing nations—such as the United States, Brazil, and Argentina—continue to ramp up the use of soybean oil in their biodiesel production efforts. Soy oil futures prices in the U.S. are likely to rise further.

Due to high edible oil prices, demand has weakened in leading buyer nations such as India. However, with stocks now depleting, India may need to increase its imports of edible oils starting in June.