Palm oil prices in Asia have hit a three-month high amid rising prices for competing oils and lower production.
Asian palm oil prices hit a three-month high on January 28, lifted by stronger rival vegetable oils, lower output expectations in Malaysia and Indonesia, and improved export prospects ahead of Ramadan. Rising prices briefly curbed buying, though demand remains supported by tight near-term supply.
Asian palm oil prices reached their highest level in more than three months on January 28, driven by stronger prices for competing vegetable oils, expectations of lower production in key producing countries and improved export prospects, market sources said.
On January 28, Platts, a subsidiary of S&P Global Energy, pegged the price of crude palm oil FOB Indonesia for February loading at $1,115 per tonne, up $5 per tonne from the previous day and 4.45% higher than the previous month. The last time the price exceeded this level was on October 21, 2025, when it was $1,122.5 per tonne.
The price increase has dampened the initial interest of buyers, who have adopted a wait-and-see attitude.
“Buying interest has declined amid rising prices,” said an Indian trader. “However, Indian buyers are still experiencing a supply shortage for February and March, so demand is expected to resume once prices decline from current levels.”
In addition, the difference between the February and March FOB Indonesia crude palm oil shipping prices widened to $30 per tonne, with the March shipping price estimated at $1,145 per tonne, S&P Global Platts reports.
“Indonesia’s produce prices have risen sharply amid expectations of tax hikes in March,” said an Indonesian exporter.
Platts estimated the February crude palm oil price CFR West Coast India at $1,142.50/mt on 28 January, up $5/mt from the previous day and 3.63% higher in a month.
Palm oil futures for three-month delivery on the Bursa Malaysia Derivatives exchange rose 0.28% to 4272 MR/t ($1089.77/t) at the market close on January 28, hitting a near three-month high.
The recent sharp rise in palm oil prices has been supported by higher prices of competing oils, including higher soybean oil prices and higher Dalian palm olein futures.
“The BMD palm oil market is responding to rising prices in the Dalian market and the Chicago Mercantile Exchange soybean oil market, which was supported by the US renewable energy commitment policy,” said an Indian trader. “Therefore, the palm oil market is also providing support given external market conditions.”
Market sources also attributed the price rise to an expected increase in Malaysian palm oil production in January and a rise in exports during the month.
“The price increase is due to lower production in both Malaysia and Indonesia, while exports are likely to rise during Ramadan and Hari Raya, leading to a monthly reduction in stocks,” said a second Indonesian exporter.
In Malaysia, the Southern Peninsula Palm Oil Association reported that palm oil production during the period from January 1 to 20 decreased compared to the period from December 1 to 20, resulting in a 16.06% decline in total production.
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Source : Ukr Agro Consult
