Palm Oil Market May Strengthen with Rebound in Global Demand

24-Apr-2025 04:29 PM

Petaling Jaya. The global palm oil market could gain support in the coming weeks if import demand strengthens from major buyers like India and China, according to the Malaysian Palm Oil Council (MPOC).

India, the largest importer of palm oil, witnessed a sharp decline in its imports during January and February 2025, as high prices made the oil less competitive compared to soybean and sunflower oil.

Although March saw a modest increase, import levels remained below the usual monthly average. April demand is also expected to stay subdued, but MPOC is optimistic that shipments to India and China will rise in May and June.

In India, lower palm oil imports in recent months have reportedly reduced domestic stock levels, potentially setting the stage for increased imports in the coming months, especially with prices now falling to more competitive levels.

Similarly, China’s palm oil inventory has also dropped significantly, prompting expectations of a rebound in purchases. Palm oil consumption in China typically rises during the summer, and ongoing trade tensions with the US could further divert demand away from US edible oils.

The Malaysian CPO price is expected to hover around 3,900 ringgit per tonne, which is considered favorable for international buyers. Meanwhile, prices of rival oils like soybean and sunflower oil are likely to see some upward movement, enhancing palm oil’s price competitiveness.

However, the palm oil sector continues to face pressure due to weak export performance in recent months and a build-up in surplus stock.

With the peak production season set to begin in a few months, producers and exporters may look to maintain attractive price levels to clear excess inventory and boost exports.