Palm oil outlook to 2031: Structural tightness to keep prices elevated

RaboResearch projects that global palm oil prices will remain elevated between 2026 and 2031, driven by rising food demand, expanding biodiesel use across Southeast Asia, and limited replanting of oil palm in Indonesia and Malaysia.

Although global palm oil production is expected to increase over this period, total output is still likely to fall short of demand. The rollout of biodiesel mandates – particularly Indonesia’s B50 and Malaysia’s B15, plus Thailand’s push for B20 in addition to its B7 mandate – will further constrain export availability, tightening global supply.

As a result, palm oil buyers may face ongoing sourcing challenges, while producers are likely to benefit from sustained price strength. Buyers will need to adopt strategic procurement approaches to manage risk and secure long‑term supply. At the same time, government policies and geopolitical developments will likely remain key sources of price volatility.