PETALING JAYA: Crude palm oil (CPO) prices will remain supported around the current level of RM2,150 per tonne although prices are expected to average slightly higher at RM2,300 per tonne next year, according to Fitch Solutions Macro Research.
CPO prices are expected to rise given the slowdown in global production growth along with robust consumption driven by Malaysia and Indonesia’s biodiesel development policy.
Both countries are steadily increasing compulsory palm oil-based biodiesel blending into conventional fuel.
Indonesia is aiming at implementing a B30 mandate as early as 2020.
In the near term, Fitch Solutions has forecast China and India’s import demand to remain strong over the coming months, which would continue to support prices.
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