Indonesia’s palm oil output on course to rise 10% in 2025, association says

Indonesia’s palm oil output could rise up to 10% this year to around 56 million tonnes, higher than previous projections, with production supported by favourable weather and strong prices, Indonesia’s palm oil association GAPKI said on Tuesday.

“Hopefully this year we can still grow compared to last year — our estimate is around 10%, to 56-57 million tonnes,” GAPKI secretary general M Hadi Sugeng told reporters.

“The weather is favourable in 2024 and 2025, with no prolonged rainfall, and good prices last year have prompted our farmers to take better care of their plantations,” Sugeng added.

GAPKI has revised its full-year forecast up from the previous 53.63 million tonnes. Output of 57 million tonnes would amount to an increase of 8% compared to 2024.

Indonesia’s palm oil exports are likely to increase to around 30-31 million tonnes, compared to 29 million tonnes shipped out in 2024, Sugeng added, with the increase in production offsetting growing domestic demand driven by an expanded biodiesel mandate.

Earlier this year, Indonesia expanded its mandatory biodiesel blending rate to 40%, up from the previous 35%, a policy known as B40.

Indonesia’s palm oil production could rise by another 5% in 2026, GAPKI forecasts show.

Palm oil stocks in Indonesia, the world’s biggest palm oil producer, dropped slightly in August to 2.54 million tonnes, 1% down from a month earlier, according to GAPKI data.

In August, the country exported 3.47 million tonnes of palm oil products in August, a 1.8% decrease from the previous month, GAPKI said, adding that crude palm oil production stood at 5.06 million tonnes.

Next year, the association is planning to use insect pollinators to transfer pollen from male to female flowers and induce fruit formation, thereby boosting output in late 2026 or early 2027, it said.