Global palm oil market faces uncertainties amid weather challenges and supply constraints

Published 2024년 12월 23일

Tridge summary

MARC Ratings predicts that the palm oil market will continue to face uncertainties and high prices into 2025 due to supply-side challenges, including adverse weather conditions and a slower replanting pace. These challenges, coupled with reduced exports from Indonesia and weather-related conditions, have led to elevated palm oil prices, which are expected to average RM4,600/metric tonne in 2025. Demand for palm oil in biodiesel production remains robust, with Indonesia planning to increase the biodiesel blend rate to 40% in 2025. However, potential downside risks include weaker demand from key markets and the impact of other edible oils. Ongoing weather conditions could also impact palm oil production, and replanting progress in Malaysia is below target.

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

Original content

Malaysian Rating Corporation Bhd (MARC Ratings) anticipates the palm oil market to continue to face significant uncertainties heading into 2025, with supply-side challenges exacerbated by adverse weather conditions and a slower replanting pace. The rating agency noted that palm oil prices in 2024 have remained elevated due to global supply constraints, driven by reduced exports from the largest palm oil producer, Indonesia, as well as recent adverse weather conditions in Malaysia. “Looking ahead, palm oil prices are expected to remain high, averaging RM4,600/metric tonne (MT) in 2025 (2024F: RM4,200/MT; 2023: RM3,812/MT). “Upside risks include lower-than-expected soybean production and Indonesia’s increasingly restrictive palm oil export policies. Conversely, downside risks include weaker-than-expected demand from key markets such as China and India, weather conditions, and increased production of other substitute edible oils,” it said in a statement. MARC Ratings said the demand ...

Source: UkrAgroConsult