DBT Bureau
Pune, 24 May 2026
Crude Palm Oil (CPO) markets remained influenced by rising imports, shifting global supply dynamics, biodiesel policy developments, and geopolitical tensions, while changing demand patterns and increasing production outlooks continued to shape price direction and market sentiment, according to the Kedia Advisory CPO report.
Highlights
● Palm oil prices gained over 3% monthly amid tight inventories and escalating Middle East geopolitical tensions.
● India’s palm oil imports surged 44.55% during November-April 2026 compared with previous corresponding period.
● India’s total vegetable oil imports jumped 13% yearly, reaching 7.94 million tonnes during November-April period.
● Indonesia increased crude palm oil export levy to 12.5% effective from March 2026 onwards significantly.
● Indonesia raised May crude palm oil reference prices above April levels, supporting global edible oil sentiment.
● Expensive Brazilian soyoil prompted Indian buyers to shift aggressively toward crude palm oil imports recently.
● India’s palm oil imports dropped 26% during April amid weaker institutional consumption demand significantly.
● Malaysian palm oil inventories increased marginally during April after declining consistently over previous three months.
● Malaysia’s crude palm oil production surged 18.37% during April amid improving harvesting conditions significantly.
● Record domestic mustard production continues pressuring crude palm oil price competitiveness in Indian edible oil markets.
● China’s surplus soyoil exports into Asia created additional competition against regional crude palm oil demand.
● India’s vegetable oil inventories declined sharply to lean 1.75 million tonnes, tightening domestic availability considerably.
● Oil World forecasts global palm oil consumption exceeding production by nearly 1.8 million tonnes during 2026-27.
● Rising geopolitical tensions increased freight surcharges and shipping costs across major edible oil trade routes significantly.
● Indonesian palm oil production projected increasing 3% during 2026-27 amid improving weather conditions globally.
● Indonesia’s delay in implementing B50 biodiesel policy released additional global exportable crude palm oil supplies.
● Malaysia’s planned B15 biodiesel rollout may significantly boost domestic palm oil consumption from June onwards.
● Australia plans to introduce biofuel blending mandates to incentivise local production and increase its energy security
● The Indian state of Goa aims to utilise used cooking oil for biodiesel production and reduce the state’s dependence on imported fuel.
● Indian ethanol makers cheer Centre’s biofuel blending plan for automobiles
● GEMA Applauds India’s Strategic Shift Toward E85 and E100 Biofuels
SWOT Analysis:
Strengths:
● Prices gained over 3% in a month due to tight port-level inventories and a surge in crude oil prices due to escalating Middle East tensions.
● During Nov – Apr 26, palm oil import increased to 3,967,013 tons from 2,744,298 tons in Nov – Apr 25, up by 44.55%.
● India’s vegetable oil imports reached 7.94 million tonnes (Nov-Apr 2026), a 13% YoY jump.
● Indonesian CPO export levy hiked to 12.5% from 10% effective Mar 1
● Indonesia has set its crude palm oil reference price at $1,049.58 per metric ton for May, up from April’s $989.63.
● High prices for Brazilian soyoil have forced Indian buyers to pivot back to CPO.
Weaknesses:
● India’s imports dropped 26% in April to a four-month low due to softer institutional demand.
● Malaysia’s palm oil stocks rose marginally higher in April by 1.17% after falling for the past three months
● Malaysia’s Crude palm oil production surged 18.37% to 1.63 million tons in April, rising for a second straight month
● Malaysia has lowered its June crude palm oil reference price to a level that maintains the export duty at 10%.
● Indonesia’s delay in moving from B40 to B50 releases approximately 2.5 million tonnes of CPO back into the global export market.
● Record 12 million tonne domestic mustard crop pressures CPO parity.
● For the first time, China is exporting surplus soyoil to the Asian region, creating direct competition for CPO.
Opportunities:
● India’s vegetable oil inventories dropped to a lean 1.75 million tonnes
● Malaysia will begin producing biodiesel with a 15% palm oil blend, hence called B15, in June to help lower diesel prices.
● Malaysian crude palm oil prices to stay above 4,500 ringgit ($1,134) in near term – MPOC
● MPOC said that supply risks remain due to geopolitical tensions and the rising risk of an El Nino weather pattern.
● Indonesia’s palm oil stocks in 2026/27 were forecast to fall by 3% to 4.3M tonnes, driven by higher domestic consumption and increased exports.
● Oil World predicts global consumption to outpace production by 1.8Mt
● Ongoing geopolitical tensions in West Asia have triggered “Emergency Conflict Surcharges” and higher freight rates for shipments.
● For 2026/27, Indonesia stock-to-use ratio falling to 8.59 i.e by 2.23% signals tightening future market balance
Threats:
● Rupee hitting all-time lows (near 96.75 per dollar) making imports costlier and created uncertainty for long-term export contracts.
● India, is grappling with its worst gas crisis in decades, as the government cuts supplies to industry and raises commercial cylinder prices.
● Temperatures ranging from 28–32°C in key Malaysian growing regions are currently favorable for fruit development
● Indonesian production forecast to recover by 2.0 million tonnes amid improving weather patterns in the second half of the year.
● For 2026-27, rising Indonesian total supply above 51.9 million tonnes increases market supply pressure.
● For 2026-27, Malaysia stock-to-use ratio expected improving 1.55%, indicating supply availability.
● Palm oil production in Indonesia is forecast to increase by 3% in 2026/27 to 48M tonnes, up from 46.7M tonnes the previous year – USDA
● Economic slowdown risks may weaken demand from industries globally
Oil Imports:
The Solvent Extractors’ Association of India has compiled the import data for vegetable oils (edible & non-edible) for Apr.,2026. Imports during the month totalled 1,310,193 tons compared to 975,025 tons in Apr., 2025 i.e. up by 34%. This includes 1,307,993 tons of edible oils and 2,200 tons of non-edible oils.
In first six months of the oil year 2025-26 (Nov’25-Apr.’26), total vegetable oil (edible + non-edible) imports reached 7,937,376 tons, up by 13% from 7,042,948 tons in the same period last year. Edible oil import in April 2026 increased to 13.08 lakh tons from 11.73 lakh tons in previous month (March,2026) i.e. up by 11%. In term of value of edible oils in six months approx. jumped to Rs. 87,000 crores compared to Rs. 73,000 crores to the same period of oil year 2024-25 i.e. up by 19%.
Country-wise Import of Palm Oil and Soft Oils
India imported a total of 78.2 lakh tonnes of edible oils, with Indonesia and Malaysia remaining the dominant suppliers of palm oils. Indonesia supplied 16.3 lakh tonnes, mainly crude palm oil, while Malaysia contributed 15.2 lakh tonnes including crude palm oil and palm kernel oil.
Argentina emerged as the largest supplier of soybean oil with 16.5 lakh tonnes, followed by Brazil. Russia and Ukraine were the major sources of sunflower oil imports, supplying 8.5 lakh tonnes and 2.7 lakh tonnes respectively.
Nepal supplied 1.90 lakh tons refined soybean oil and small quantities of other oils. Overall, palm oil constituted the largest share of imports, followed by soybean oil and sunflower oil.same period of oil year 2024-25 i.e. up by 19%.
Oil Imports:
Domestic Stock as on 1st May, 2026:
The overall stock position remained stable to firm during the period under review, with total stock increasing from 1,351,000 tons in May 2025 to 2,123,000 tons in May 2026. Port stock witnessed fluctuations, reaching a peak of 1,029,000 tons in October 2025 before moderating in early 2026.
Pipeline stock showed a steady upward trend, particularly from December 2025 onward, contributing significantly to the rise in total inventory levels. The data indicates improved stock availability and stronger pipeline movement in the latter part of the year.
Country-wise Import of Palm Oil and Soft Oils:
India imported a total of 78.2 lakh tonnes of edible oils, with Indonesia and Malaysia remaining the dominant suppliers of palm oils. Indonesia supplied 16.3 lakh tonnes, mainly crude palm oil, while Malaysia contributed 15.2 lakh tonnes including crude palm oil and palm kernel oil. Argentina emerged as the largest supplier of soybean oil with 16.5 lakh tonnes, followed by Brazil. Russia and Ukraine were the major sources of sunflower oil imports, supplying 8.5 lakh tonnes and 2.7 lakh tonnes respectively.
Nepal supplied 1.90 lakh tonnes of refined soybean oil and small quantities of other oils. Overall, palm oil constituted the largest share of imports, followed by soybean oil and sunflower oil.
Conclusion:
Price Performance: Crude Palm Oil prices gained over 3% during the month as tight port-level inventories and rising crude oil prices supported the edible oil complex. Malaysian palm oil futures surged 19.47%, marking the strongest gain since April 2022. However, India’s imports declined 26% in April, while improving Malaysian production capped aggressive upside momentum.
Supply Tightness & Biodiesel Demand: CPO fundamentals remained supported as Malaysian production declined 16% in February, while inventories dropped 3.9% to 2.70 MMT. Indonesia also raised export levy to 12.5%, tightening global availability. Additionally, Indonesia’s B40 biodiesel policy and Malaysia’s upcoming B15 blending program increased domestic palm oil consumption, strengthening overall demand sentiment despite gradual supply recovery expectations.
Imports, Stocks & Domestic Demand: India’s palm oil imports during Nov–Apr 2026 increased 44.55% YoY to 3.96 million tonnes, while total vegetable oil imports rose 13% to 7.94 million tonnes. High Brazilian soyoil prices shifted Indian buyers toward cheaper CPO. However, April imports declined sharply by 26%, and improving domestic edible oil inventories at 2.123 MMT limited immediate demand strength.
Global Competition & Currency Risks: Global consumption is projected to exceed production by 1.8 MMT, supporting medium-term price sentiment. However, competition from surplus Chinese soy oil exports and India’s record 12 million tonne mustard crop increased pressure within the vegetable oil complex. Additionally, Indonesia’s production is forecast to rise 3% to 48 MMT during 2026-27, while rupee depreciation near 96.75 increased import costs.
Technical Outlook: CPO prices continue showing weakness after confirming a bearish reversal structure on higher time frames. RSI remains under pressure, MACD maintains negative crossover momentum, and volatility indicators suggest continuation of corrective downside movement. Prices are expected to remain weak below key resistance zones of 1440–1480 initially, while sustained trading below 1370 could trigger further decline towards lower support levels.
Disclaimer:
Commodity investments are subject to market risks, including price volatility and economic uncertainties. Investors are advised to carefully read all related documents and assess their risk appetite before making any investment decisions. Past performance is not indicative of future results.
