Citigroup expects palm oil prices to weaken

Citigroup analyst Gan Huan Wen stated in a report that as palm oil production increases during the peak season, palm oil prices may decline by 5%-10% in the coming months. Data from the Malaysian Palm Oil Board in August showed that palm oil inventories have risen to a 20-month high, with production year-to-date reaching 102% of Citigroup's full-year forecast. He pointed out that although recent demand from India, China, and Pakistan has pushed spot prices up by about 5% over the past month, Malaysia's exports are lagging behind Indonesia. The price discount of crude palm oil relative to soybean oil is narrowing. Citigroup maintains a bearish outlook on the Malaysian palm oil industry and continues to expect CPO prices to be MYR 4,200 per ton in 2025 and MYR 4,000 per ton in 2026