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Malaysian palm oil production is expected to surpass 20 million tonnes for the first time in its history by 2025, assuming favourable weather conditions persist and the harvest season proves successful. Reuters reported details of these optimistic forecasts, citing data from the Malaysian Palm Oil Board.
This record output in Malaysia — the world's second-largest palm oil exporter — is likely to swell stockpiles, which could weigh on futures contracts already trading at five-month lows.
Malaysian palm oil stocks climbed to their highest level in more than 6.5 years in November, reaching 2.84 million tonnes as exports declined. Despite an anticipated improvement in export demand, stocks are expected to keep rising and could approach the 3-million-tonne mark by the end of December.
Even so, experts note that the supply shortfall in the global vegetable oils market, which emerged in 2025, is expected to persist into 2026.
As a reminder, the area planted with oil palm has grown by 11% over the past twenty years and is set to reach 27.9 million hectares by the end of this year.
Source: Reuters