Malaysia to introduce reference price for used cooking oil
The Malaysian Palm Oil Board (MPOB) will introduce an official reference price for used cooking oil in the first quarter of 2026. The board stated that this move aims to improve market transparency, ensure fair trade, and strengthen the development of a circular economy in the palm oil industry.
This benchmark is expected to provide clearer price signals while protecting smaller market participants from price manipulation and misinformation, Malaysian Plantations and Commodities Minister Noraini Ahmad announced on January 20.
The reference price will be based on a local delivered price reflecting the value of used cooking oil in Malaysia and incorporating local transportation costs, rather than the FOB (free on board) export price.
The initiative is noted to support Malaysia’s commitment to a circular economy in which used cooking oil and by-products are transformed into valuable industrial and energy resources.
This initiative comes after the Malaysian palm oil industry, the world’s second-largest producer after Indonesia, recorded record crude palm oil production in 2025.
Last year, used cooking oil prices in Asia reached a two-year high thanks to stronger demand in the Chinese and European markets, S&P Global Commodity Insights reported in January 2025.
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