CPO Prices Seen Averaging RM4,100-RM4,200 Per Tonne In 2026
KUALA LUMPUR, March 11 (Bernama) -- Crude palm oil (CPO) prices are projected to average between RM4,100 and RM4,200 per tonne in 2026, supported by firmer crude oil prices that could improve biodiesel economics and support Indonesia’s potential B50 mandate.
MBSB Research said it expects the CPO price to edge higher in March, averaging at RM4,212 per tonne or 3.3 per cent higher month-on-month, supported by seasonally softer output during the pollination months.
In a note today, it said that the softer output was influenced by Brent crude price-led sentiment following the recent United States-Iran conflict, which could support the potential B50 biodiesel mandate in Indonesia.
The research house said that it maintains the 2026 CPO price target at RM4,200 per tonne, noting that the Malaysia Palm Oil Board prices have yet to break the upper resistance band of RM4,500 per tonne.
Overall, it continued its positive call on the palm oil sector, supported a narrowing palm oil-gas oil spread.
"Firmer Brent crude could lift gas oil prices, improve biodiesel economics and make Indonesia’s potential B50 mandate more manageable. Higher domestic absorption may tighten palm oil availability and support CPO prices,” it said.
Meanwhile, Maybank Investment Bank (Maybank IB) said the West Asia conflict has momentarily pushed crude oil price above US$100 per barrel (bbl) earlier this week.
"Crude oil historically had a low positive price correlation with CPO when the price gap is wide between them.
“However, when crude oil price narrows its gap with CPO, this is expected to have a stronger price correlation between them as a high crude oil price will make biofuel mandates more economical," it said.
The investment bank forecast the average selling price of CPO at RM4,100 per tonne, with an upside potential if crude oil prices rally more than US$100 bbl and make Indonesia's B50 biodiesel mandate a reality.
Overall, Maybank IB maintains its "neutral" call on the CPO sector, with top picks including SD Guthrie Bhd with a target price (TP) of RM6.59 and Sarawak Oil Palms Bhd (TP: RM5.47).
-- BERNAMA