Palm oil stocks in March signal price declines to come

The Malaysian Palm Oil Board (MPOB), which had earlier recorded a rise in production in March, estimated the ending stocks of crude palm oil at 1.38 million tonnes at the end of March, marking the start of a seasonal uptrend, with palm oil yields set to rise soon and continue through October, The Star reported.

The crude palm oil (CPO) price held steady at RM4,740 per tonne in March. However, with Brazil’s soybean harvest set to end soon, edible oil prices are set to see a seasonal decline in the second quarter of this year.

“The seasonal decline was expected. The recent decline in crude prices continues to provide a cushion for biodiesel demand, but its impact on CPO prices remains limited. We maintain the average CPO price at RM4,200/tonne in 2025 and RM4,000/tonne in 2026. Overall edible oil prices should remain stable, but the price of palm oil relative to soybean oil should decline; hence our slightly lower CPO price forecast for 2026,” it said.

“CPO futures fell to their lowest in six months in October 2024, driven by lower soybean oil and crude oil prices on the Chicago Board of Trade following the tariffs,” it said. Analysts noted that after months of trading at a premium, CPO is now trading at a discount.

“We believe this is due to several factors, including that CPO supplies are forecast to rise seasonally in the coming months, necessitating a competitive price for the tropical oil compared to other vegetable oil alternatives, and the spread between palm oil and the low sulphur gasoil we track in Europe remains wide, with CPO trading at a premium of US$584,” the council said.

The report also said that despite the strong percentage figures, export numbers were weak in digital terms, with April figures still comparatively low at around one million.

OleoScope data show that on 11/04/2025, the palm oil price (FOB Malaysia) for April delivery was $1,062.16/t. The price of soybean oil (CBOT) for April delivery was $1,043.89/t, up $22.71/t from the change on 10/04/2025 ($1,021.18/t). This is the highest value in a week.

Tags: prices, Malaysia, palm oil, stocks