Rise in stockpiles likely to cap CPO prices

Published 2025년 5월 16일

Tridge summary

Palm oil stocks have reached their highest level in six months at 1.87 million tonnes in April, which may limit future crude palm oil (CPO) prices. This increase is expected to persist due to seasonal factors, reduced demand, and low CPO prices, leading to a 20% decrease in CPO price this year. Analysts maintain a neutral stance on the plantation sector with CPO price forecasts for 2025, and continue to recommend buying certain companies. However, potential downside risks include lower soybean supply, a weak demand recovery, lower production, and reduced production costs. The conflict between India and Pakistan could also impact demand.

Disclaimer:The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

The sharp rise in palm oil stocks to 1.87 million tonnes in April, the highest in six months, may put a cap on crude palm oil (CPO) prices moving forward, say analysts. According to Hong Leong Investment Bank (HLIB) Research, the uptrend in palm oil stock level would likely persist in the near term, driven by seasonally higher cropping pattern, subdued festive-driven demand, and weak CPO prices – which imply lower discretionary biodiesel blending activities. Furthermore, the conflict between India and Pakistan, two of the major importers of palm oil, could dampen demand from these markets if the tension re-escalates, it said in a report yesterday. On CPO prices, the research house said “we maintain our 2025 to 2026 CPO price assumptions of RM4,000 per tonne and RM3,800 per tonne, with the view that continued output recovery (particularly from Indonesia) will cap palm oil prices over the near to medium term.” Year-to-date, CPO price has eased by over 20% to RM3,780 per tone due ...

Source: UkrAgroConsult