- Export surge: Global palm oil exports are projected to jump 9.4% to 26.2 million tonnes in 2025, led by a sharp increase in Indonesian shipments.
- Price advantage: Elevated Malaysian inventories are improving palm oil’s price competitiveness versus other vegetable oils, challenging Black Sea sunflower oil demand.
- Moderating output: Global production is forecast to ease to 43.92 million tonnes in 2026 from 44.35 million tonnes in 2025, despite continued growth in Indonesia.
- Import pivot: Key buyers such as India and China are expected to increase palm oil purchases, potentially squeezing margins for competing Black Sea oilseed exports.
Global Palm Oil Export Outlook
Global palm oil trade is entering a period of accelerated growth, with exports forecast to rise from 23.95 million tonnes in 2024 to 26.2 million tonnes in 2025. The expansion is driven primarily by Indonesia, which is expected to ramp up shipments significantly, even as Malaysia’s exports edge lower.
| Year | Region | Exports (million tonnes) |
|---|---|---|
| 2024 | Global | 23.95 |
| 2025 | Global | 26.20 |
| 2026 | Global | 25.89 |
| 2024 | Indonesia | 11.59 |
| 2025 | Indonesia | 14.12 |
| 2026 | Indonesia | 13.41 |
| 2024 | Malaysia | 8.62 |
| 2025 | Malaysia | 7.85 |
| 2026 | Malaysia | 8.25 |
Production Dynamics and Supply Outlook
Despite strong export growth, global palm oil production is expected to soften slightly from 44.35 million tonnes in 2025 to 43.92 million tonnes in 2026. Indonesia is projected to expand output, while Malaysia faces a mild decline, reflecting structural and policy-related constraints.
| Year | Region | Production (million tonnes) |
|---|---|---|
| 2025 | Global | 44.35 |
| 2026 | Global | 43.92 |
| 2025 | Indonesia | 22.46 |
| 2026 | Indonesia | 25.04 |
| 2025 | Malaysia | 10.66 |
| 2026 | Malaysia | 10.42 |
Uncertainties around Indonesian government policies on fertilizer usage, tree pruning, new plantations, and broader productivity measures could still alter the medium-term production trajectory. In Malaysia, elevated inventories are supporting export competitiveness even as underlying output trends soften.
Impact on Competing Vegetable Oils and Black Sea Exports
Improved price competitiveness of crude and refined palm oil, underpinned by high Malaysian stocks, is creating strong headwinds for alternative vegetable oils, particularly Black Sea sunflower oil. As buyers like India, China, Vietnam, Mexico, and Nigeria either expand or resume palm oil purchases, Black Sea sunflower oil exports from Ukraine and Russia could see mounting pressure on volumes and margins through 2026.
Traders should track relative price spreads between palm oil and sunflower oil, as well as the pace of inventory drawdown in Malaysia. Sustained low palm oil pricing may lock in demand shifts and structurally reduce Black Sea market share in key importing regions.
Key Importer Demand Trends
India is expected to lead demand growth, with palm oil imports forecast to rise markedly in the December–March 2025/26 marketing window. Additional buying interest from China and other emerging market importers could further tighten available exportable supplies of competing vegetable oils and reinforce palm oil’s role as the price benchmark across the complex.
Source: Market Data
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