What CPO price range does MPOB expect for 2024, and why?

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MPOB Projects Crude Palm Oil Prices Between RM3,900 and RM4,200 Per Tonne for 2024

The Malaysian Palm Oil Board (MPOB) anticipates the price of crude palm oil (CPO) to fall within the RM3,900 to RM4,200 per tonne range for 2024. This forecast is primarily influenced by Indonesia's B35 biodiesel mandate, which is expected to constrain the global supply of palm oil available for export, thereby supporting higher CPO prices.
Impact of Indonesia's B35 Biodiesel Mandate

Indonesia's implementation of the B35 biodiesel mandate is a significant factor expected to drive up CPO prices. This policy requires a higher blend of palm oil in biodiesel, diverting a substantial portion of the country's palm oil output away from the international export market. Consequently, this reduction in exportable supply is projected to create upward pressure on global palm oil prices, including CPO.
Tight Global Supply Due to Weather and Soybean Production

The global supply of palm oil is also anticipated to remain tight throughout 2024. Unfavourable weather conditions experienced in 2023 have impacted crop yields, and this effect is expected to persist. Furthermore, soybean production, a key competing vegetable oil, is projected to face supply constraints at least until April 2024. This dual pressure from reduced palm oil and soybean availability contributes to the overall tight global supply scenario.
Malaysia's Stock Levels and Price Stability

Malaysia's own palm oil stocks are expected to remain below the 2.0 million tonnes mark in 2024. Historically, lower stock levels tend to contribute to price stability by ensuring that supply closely matches demand. This anticipated reduction in Malaysian stocks will play a role in supporting the projected price range for CPO.

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What CPO price range does MPOB expect for 2024, and why?

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