Chennai: India’s purchases of palm oil from Malaysia reached 312,000 tonnes in September, the highest level in 11 months. This surge is contributing to tighter supplies of cooking oils worldwide. The price of palm oil is now staying above 4,400 Malaysian ringgit per tonne, supported by potential new biofuel rules in Indonesia and reduced soybean oil exports from the United States, Brazil, and Argentina, reports The Hindu businessline.
Experts warn that shoppers could face consistently higher prices for cooking oil into the year 2026.
A report from the Malaysian Palm Oil Council (MPOC) stated that the country’s palm oil exports saw a significant jump in September. This was driven mostly by a major recovery in shipments to India, providing an important boost for the world’s biggest buyer of edible oil.
Overall exports grew by 7.7% from the previous month to 1.42 million tonnes, with the South Asia region, led by India, showing the strongest growth.
Despite sending more oil abroad, the amount of palm oil stored in Malaysia climbed to 2.36 million tonnes, the highest in nearly two years. Local use returned to normal levels after a record high in August.
In September, palm oil was more expensive than soybean oil in key markets like India and Europe. Analysts point to a potential new rule in Indonesia that would require more palm oil to be used for biofuel. This could significantly reduce the amount available for export to global food markets.
Looking ahead, the supply of all major vegetable oils is expected to remain tight. Soybean oil exports from the Americas are forecast to fall sharply because more is being used for biofuel at home. Supplies of sunflower oil are also tight, keeping its price high.
As a major importer, India is likely to feel the effects of these constrained supplies. With existing stocks of palm oil already high in major consuming countries, buyers are expected to be careful with new purchases. Overall, global vegetable oil prices are predicted to remain firm through 2025, with Malaysian palm oil prices holding steady. However, the market remains cautious due to high stockpiles in countries like China and India, and increasing trade tensions.
