Palm oil exports forecast to be stable in 2027

By the Editorial Team · Wednesday, September 23, 2026

The Malaysian Palm Oil Council projects that Malaysia’s palm oil exports will hold steady at around 16 million tonnes in 2027 despite a slight production decline. This steady export forecast highlights Malaysia’s growing importance as a global supplier amid Indonesia’s expected production and export reductions driven by rising domestic biodiesel demand.

The Malaysian Palm Oil Council (MPOC) anticipates that palm oil exports from Malaysia will remain stable at approximately 16 million tonnes in 2027, positioning the country as a key supplier to global markets. This outlook was based on independent market analyses and forecasts from Oil World, released in September 2026.

According to the forecasts, Indonesia’s palm oil production is expected to decline by 1.9 million tonnes in 2027, accompanied by a projected drop in its exports by nearly three million tonnes. This decrease is attributed to rising domestic demand linked to biodiesel blending policies and a generally weaker production outlook in Indonesia. In comparison, Malaysia’s palm oil production is also forecasted to fall, but by a smaller margin of 0.7 million tonnes.

The MPOC emphasized that despite the anticipated decrease in production, Malaysia’s role in supplying palm oil globally is expected to grow, partly because the country currently holds relatively high stock levels, which are expected to be temporary. The council highlighted that in August 2026, Malaysia’s palm oil output increased marginally by 1.4% month-on-month to 1.81 million tonnes, supported by higher collection of fresh fruit bunches and improved oil extraction rates from the previous month.

However, despite this monthly increase, production in August remained below the level recorded a year earlier. This marked the sixth consecutive month of year-on-year decline in Malaysian palm oil production since March 2026. On the export front, cumulative shipments from January to August 2026 rose by 806,000 tonnes, reaching a total of 10.4 million tonnes. Still, exports fell 7.5% on a month-to-month basis in August, dropping to 1.29 million tonnes. This decline was attributed to weaker shipments primarily to South Asia and the Middle East.

The analysis underscores a regional shift in the palm oil market, with Malaysia's role expected to become more prominent as Indonesia's production and exports contract due to changing domestic demands and supply challenges. However, continued year-on-year production declines and fluctuating export volumes indicate an ongoing volatility in the global palm oil supply chain.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.