CPO Market Seen Starting 2026 On Weaker Note Following High 2025 Prices - MARC Ratings

KUALA LUMPUR, Dec 4 (Bernama) -- The crude palm oil (CPO) market is expected to enter 2026 with a softer outlook, following the relatively elevated prices recorded in 2025.

Malaysian Rating Corporation Bhd (MARC Ratings) projects prices to range between RM3,850 per tonne and RM4,250 per tonne in 2026 from RM4,300 per tonne this year.

It said the softer trajectory is underpinned by more favourable weather patterns, recovering yields and a gradual normalisation in global production, reflecting a shift from the tight supply conditions seen in early 2025.

“While CPO prices were higher in 2025 compared to 2024, an unexpectedly large supply surge in Indonesia kept prices below MARC Ratings’ initial expectations,” it said in a statement today.

However, MARC Ratings said overall supply gains led to a lower CPO price peak in 2025 compared to 2024, with the CPO price peaking at RM4,875 in 2025, below the 2024 high of RM5,343.

In recent years, rising palm oil production has been supported by yield recovery with the improved weather conditions after the 2023-2024 El Nino event.

“Output in Indonesia rose significantly by 11.3 per cent year-to-date as at September 2025, while Malaysia posted a modest 1.8 per cent increase as at October 2025,” it said.

Going into 2026, it said demand dynamics remain broadly supportive despite some variation between markets.

The United States Department of Agriculture (USDA) forecasts suggest global palm oil consumption will grow, albeit remaining slightly below total production.

“India, the largest CPO importer, is expected to sustain strong purchases, supported by palm oil’s price competitiveness relative to soybean and sunflower oils,” it said.

Meanwhile, the Food and Agriculture Organisation of the United Nations projects a 2.1 per cent increase in the utilisation of global oils and fats in 2026, led predominantly by the biofuel sector, it added.

-- BERNAMA