Global Palm Oil Prices
Global Palm Oil Price
Global Palm Oil Price Overview
As of early May 2025, the global price of crude palm oil has stabilized at approximately $210.79, following a sharp decline during the second half of March and early April. This drop came after a period of strong price growth in the final quarter of 2024 and early 2025, when prices had exceeded $260.
The recent decline is likely driven by an increase in inventories across key markets, improved supply conditions in major producing countries such as Indonesia and Malaysia, and a temporary slowdown in demand from major importers like China and India. However, the price trend remains sensitive to critical factors including weather conditions, regional export policies, and volatility in the prices of other vegetable oils, suggesting the market may continue to experience short-term fluctuations.
Global Palm Oil Price Drivers and Regional Market Analysis
- Supply Constraints: Seasonal production slowdowns and weather-related disruptions have limited fresh fruit bunch yields, contributing to upward price pressure.
- Robust Demand: Growing consumption in Asia for food and biofuel, combined with resumed economic activities post-pandemic, has bolstered market sentiment.
- Regional Variations: Southeast Asia, the largest producer of palm oil, has seen relatively stronger price gains due to local stock drawdowns. Meanwhile, importing regions such as the Middle East and North Africa face additional shipping and logistics costs, pushing regional prices slightly higher.
Global Palm Oil Price Forecast
- Short-Term (1–3 Months): Following the recent sharp decline, the market is expected to gradually stabilize. With partial price recovery and renewed demand in Asian markets, prices are projected to fluctuate within the range of $950 to $1,000 per metric ton.
- Medium-Term (3–12 Months): If the improvement in exports from Indonesia continues and inventory levels return to balance, prices are likely to stabilize within the range of $980 to $1,050.
- Long-Term (1+ Years): Climatic phenomena such as El Niño and fluctuations in production among key producing countries may lead to a gradual increase in prices. Accordingly, global palm oil prices are projected to reach around $1,150 to $1,200 per metric ton by the end of the year.
Palm Oil Prices FAQs
Over the past month, the global price of palm oil has declined from approximately $260 to $210.79, representing a drop of around 18.9%. This significant decrease reflects a bearish market trend during this period.
Key factors include increased inventory levels, improved supply in major producing countries such as Malaysia and Indonesia, and a temporary decline in global demand—particularly from China and India.
Higher palm oil costs may squeeze profit margins for producers of food products and biodiesel, potentially leading to slightly increased costs for end consumers as well.