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).
According to BERNAMA News Agency, MPOC noted that recent biofuel developments in the United States have enhanced the price competitiveness of palm oil in 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," the council stated.
In March 2026, the US Environmental Protection Agency (EPA) finalized record-high Renewable Fuel Standard (RFS) blending mandates for 2026 and 2027. The EPA estimates that to meet the historic 2026 and 2027 volume levels, biodiesel and renewable diesel production and use will need to increase by over 60 percent compared to 2025 volumes.
MPOC anticipates 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. The council also highlighted supply risks due to unresolved geopolitical tensions and rising El Nino risk, which could add uncertainty to global vegetable oil supply in the upcoming season.
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.
Regarding palm oil exports, MPOC reported that combined exports from Malaysia, Indonesia, and Thailand rose 1.9 million tonnes in the first quarter of 2026. However, it is expected that this trend will reverse between April and September 2026, with Oil World projecting combined exports from the three countries to decline by 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," MPOC stated.