- Palm oil exports rising: Global palm oil exports are projected to increase to 26.2 million tonnes in 2025 from 23.95 million tonnes in 2024, led by stronger Indonesian shipments.
- Inventory-driven price pressure: Malaysian palm oil stocks surged 13% month-on-month to 2.84 million tonnes, weighing on prices and boosting palm oil’s price competitiveness.
- Shifting demand patterns: Strong import demand is expected from India in Dec–Mar 2025/26, with potential buying resumption by China, Vietnam, Mexico, and Nigeria.
- Mixed production outlook: Global palm oil production is forecast to edge down to 43.92 million tonnes in 2026, despite a projected increase in Indonesian output.
- Bearish for Black Sea vegoils: Cheaper palm oil may erode demand for Black Sea sunflower oil in key markets such as India and China.
Palm Oil Export Outlook
Oil World (Germany) expects global palm oil exports to climb to 26.2 million tonnes in 2025, up from 23.95 million tonnes in 2024. Indonesia is set to drive this growth with shipments rising to 14.12 million tonnes from 11.59 million tonnes, while Malaysia’s exports are forecast to decline to 7.85 million tonnes from 8.62 million tonnes.
For 2026, global palm oil exports are projected at 25.89 million tonnes, with Indonesia shipping 13.41 million tonnes and Malaysia 8.25 million tonnes. Despite the strong export outlook, global production is expected to slip to 43.92 million tonnes in 2026 from 44.35 million tonnes in 2025.
Production and Inventory Dynamics
Indonesian palm oil production may increase to 25.04 million tonnes in 2026 from 22.46 million tonnes in 2025, though outcomes will depend on the scale and impact of government intervention in the sector. In contrast, Malaysian production is projected to edge lower to 10.42 million tonnes from 10.66 million tonnes.
Malaysia’s December exports fell 16%, contributing to a sixth consecutive month of stock builds. Inventories reached 2.84 million tonnes, up 13% month-on-month, creating downward pressure on prices and enhancing the price competitiveness of palm oil against alternative vegetable oils.
Key Figures: Exports, Production, and Stocks
| Metric | 2024 | 2025 (Forecast) | 2026 (Forecast) |
|---|---|---|---|
| Global Palm Oil Exports (million tonnes) | 23.95 | 26.20 | 25.89 |
| Indonesia Exports (million tonnes) | 11.59 | 14.12 | 13.41 |
| Malaysia Exports (million tonnes) | 8.62 | 7.85 | 8.25 |
| Global Palm Oil Production (million tonnes) | — | 44.35 | 43.92 |
| Indonesia Production (million tonnes) | — | 22.46 | 25.04 |
| Malaysia Production (million tonnes) | — | 10.66 | 10.42 |
| Malaysia Stocks, December (million tonnes) | — | 2.84 | — |
| Malaysia Stocks, December MoM Change | — | +13% | — |
| Malaysia December Exports Change | — | -16% | — |
Demand from Key Importers
Strong import demand is anticipated from India during the December–March 2025/26 period, when its buying activity typically peaks. Improved palm oil price competitiveness could make it more attractive versus alternative vegetable oils.
Additional upside for exports could come from a resumption of buying by China, Vietnam, Mexico, and Nigeria, which would further support palm oil offtake amid elevated Malaysian inventories.
Implications for Black Sea Vegetable Oils
The outlook is neutral to bearish for Black Sea vegetable oil exports, particularly sunflower oil. Elevated Malaysian stocks and softer palm oil prices improve palm oil’s competitiveness in price-sensitive markets, potentially displacing Black Sea-origin sunflower oil in India and China.
Traders should closely track the December–March buying window, monitoring whether palm oil’s pricing advantage erodes Black Sea market share in key destinations and weighs on premiums for sunflower oil and other Black Sea oilseed products.
Source: Market Data
Leave a Reply