The Malaysian Palm Oil Board (MPOB) expects crude palm oil (CPO) prices to remain strong at between RM4,000 and RM4,300 per tonne this year, supported by higher global petroleum prices.
Its director-general Datuk Dr Ahmad Parveez Ghulam Kadir said palm oil prices are expected to stay firm, driven by movements in global oil markets following tensions in the Strait of Hormuz.
“Looking at the current situation, palm oil prices have remained strong, and for this year we are targeting an average price of between RM4,000 and RM4,300 per tonne,” he said at a press conference after the MPOB 2026 Palm Oil Technology Transfer (TOT) Programme.
He explained that disruptions in the Strait of Hormuz have affected global petroleum supply, which has in turn lifted prices of palm oil and other vegetable oils due to their close price relationship.
On supply conditions, Ahmad Parveez said the industry is also facing potential production constraints due to the lingering effects of the El Niño phenomenon, which has impacted oil palm pollination.
“We are monitoring the potential post-El Niño effects, which bring hotter weather and lower rainfall,” he said.
“The impact is not immediate, but it affects pollination activities carried out by oil palm weevils. Hotter conditions reduce insect activity, leading to lower pollination rates and ultimately reduced oil yields.”
On the European Union Deforestation Regulation (EUDR), he said more than 80% of smallholders in Peninsular Malaysia are already prepared to comply with the requirements.
He added that MPOB is targeting 90% to 95% of eligible smallholders with valid licences and clear land ownership to be included in its compliance system before the regulation takes effect for smallholders in the middle of next year.
“Once incorporated into the system, their palm oil will be able to enter the European Union market without compliance issues,” he said.
