Fitch Ratings raises the CPO price forecast in Malaysia and Indonesia for 2025

KUALA LUMPUR (Dec 30): Fitch Ratings has revised its 2025 price forecast for Malaysian crude palm oil (CPO) spot benchmark to US$800 (RM3,576) per tonne, while projecting a decline to US$700 per tonne thereafter, according to its note dated Dec 27. "Our revised assumptions reflect a slower rebound in yields in Indonesia, the world’s largest palm oil producer, and increasing biodiesel consumption in the country. Despite the hike, our assumption implies that prices will weaken from 2024, due to higher supply and competition with soybean oil." Fitch had earlier assumed an average price of US$750 per tonne in 2025 and US$650 per tonne thereafter. According to the note, despite the higher price forecasts, Fitch expects CPO prices to weaken from 2024 due to increased supply and growing competition from soybean oil. CPO prices surged past US$1,200 per tonne in early December 2024, driven by weaker output from Indonesia and Malaysia, where heavy rains hampered harvesting. Prices have ...