Palm Oil Prices Unlikely to Fluctuate Significantly

25-Dec-2025 07:50 PM

Kuala Lumpur. Malaysia has a large surplus stock of palm oil, while export demand is expected to remain strong next month.

This is due to the Lunar New Year celebrations in China and other countries, as well as the upcoming Ramadan festival in Muslim-majority nations.

The peak season for palm oil production in Malaysia is ending, meaning that production of this important vegetable oil is unlikely to increase significantly over the next two to three months.

Under these circumstances, a considerable balance is expected between the demand and supply of palm oil. Considering this, the Malaysian Palm Oil Board (MPOB) has projected the futures price of crude palm oil (CPO) to be between 3800 and 4100 ringgit per ton during the January-March 2026 quarter.

According to the board, the export duty on CPO has also been reduced from 10 percent in December 2025 to 9.5 percent for January 2026, which will help exporters keep their export offer prices competitive.

In fact, during the January-March quarter, there will be a strong soybean harvest in Latin American countries, especially Brazil, which could put pressure on soybean oil prices. Soybean production in Brazil is expected to reach a new record level this year as well.

The US has a large stock of this oilseed, and China is showing very little interest in purchasing it. China may import a good quantity of palm oil from Indonesia and Malaysia, but the situation in India remains uncertain.