Lang
Malaysian palm oil stocks fell 16.1% month on month to 2.26 million tonnes in March 2026, as exports outstripped production amid strong global demand and front-loaded shipments ahead of an expected rise in freight costs, according to the Malaysian Palm Oil Council (MPOC).
The council said exports rose to 1.55 million tonnes in March against production of 1.37 million tonnes, reflecting robust buying activity and a decline in Indonesian shipments after exporters there rushed to deliver orders before higher levies took effect.
The MPOC said: "During the first quarter of 2026, Malaysia's palm oil exports rose 29.1% year on year, or 927,000 tonnes, with North Africa leading growth at 94%, followed by South Asia at 74% and other parts of Europe and Central Asia at 47%." The council also noted that palm oil prices drew additional support from higher crude oil prices and rising biodiesel demand, with vegetable oil consumption for blending expected to reduce exportable supplies in key producing countries.
Domestic biodiesel mandates in Southeast Asia are expected to absorb an additional 1 million to 1.5 million tonnes of palm oil in the second half of 2026, with Malaysia's B15 programme requiring 300,000 tonnes a year, while Indonesia's B50 mandate could add three million tonnes if fully implemented.
Further supply-side pressure may emerge from higher blending targets in Thailand and tighter controls on crude palm oil exports, while geopolitical tensions in the Middle East continue to keep energy prices elevated.
The council said crude palm oil prices are expected to remain supported at around 4,500 Malaysian ringgit per tonne in the near term, driven by favourable biodiesel economics, higher crude oil prices and the risk of a potential El Niño event. Any upside may be capped, however, by weak demand in key import markets amid inflationary pressures, slowing economic growth and rising production as the sector enters its seasonal peak.
Source: Business Today