KUALA LUMPUR: Crude palm oil (CPO) prices are expected to hold around RM4,400 per tonne in June 2026, supported by global biofuel policies, says the Malaysian Palm Oil Council (MPOC).
MPOC said the latest United States biofuel developments have improved palm oil’s price competitiveness across major markets.
"Palm oil remains the most competitively priced vegetable oil in India, while palm olein prices in Malaysia were also trading at a marginal discount to Argentine soybean oil, a pricing dynamic that should continue to support palm oil demand," it said in a statement today.
In March 2026, the US Environmental Protection Agency (EPA) finalised record-high Renewable Fuel Standard (RFS) blending mandates for 2026 and 2027.
"To meet the historic 2026 and 2027 volume levels, EPA estimates that biodiesel and renewable diesel production and use will need to increase by over 60 per cent compared to 2025 volumes," the agency said in its official website.
Meanwhile, MPOC anticipated that vegetable oil prices could still trend higher moving forward as the recent price correction was likely driven by profit-taking among funds and speculators.
"Supply risks also remain due to unresolved geopolitical tensions and rising El Nino risk, which could add uncertainty to global vegetable oil supply in the upcoming season," it said.
Citing data from the Malaysian Meteorological Department, MPOC expects El Nino conditions to develop between June and July, potentially persisting into early 2027.
El Nino typically brings drier-than-normal weather conditions to Southeast Asia, reducing rainfall and soil moisture and potentially affecting regional agricultural supply, it said.
On palm oil exports, it said the combined palm oil exports from Malaysia, Indonesia and Thailand rose 1.9 million tonnes in the first quarter of 2026 (1Q 2026).
However, it noted that the trend is expected to reverse between April and September 2026, with global oils and fats market analysis firm Oil World projecting combined exports from the three countries to decline two million tonnes in the second and third quarters, mainly due to lower Indonesian exports.
"Malaysia’s exports are projected to rise 400,000 tonnes during the period, while Indonesia’s exports are forecast to decline 1.7 million tonnes as more palm oil is redirected towards domestic energy use.
"As a result, a sharp build-up in palm oil stocks is unlikely during the upcoming peak production season in Southeast Asia," it said. - Bernama
