CPO Price Outlook For 2026-2027 Raised On Rising Supply Risks - CIMB Securities
KUALA LUMPUR, Aug 11 (Bernama) -- CIMB Securities Sdn Bhd has raised 2026 and 2027 crude palm oil (CPO) price forecasts by RM50 per tonne to RM4,450 per tonne and RM4,550 per tonne, respectively, on rising supply risks.
In a note today, CIMB Securities said the increased CPO prices will be supported by rising geopolitical risks, strengthening El Nino conditions, and higher biodiesel demand in Indonesia.
“Sunflower oil exports from Russia and Ukraine fell sharply in late July 2026 and are expected to remain very low in August 2026, after intensified attacks on ports, infrastructure, and commercial vessels prompted several major players to suspend operations and export offers.
“This could support substitution demand for palm oil ahead of India’s festival season from September–November,” it said.
CIMB Securities also noted that stronger El Nino conditions could reduce oil palm yields and production in Southeast Asia with a time lag, posing greater downside risks to supply from 2027 onwards.
Meanwhile, Indonesia’s nationwide B50 biodiesel mandate is expected to consume 16.7 million kilolitres to 18.0 million kilolitres of palm biodiesel annually, providing additional support to palm oil demand.
“However, relatively high Malaysian palm oil inventories and CPO’s price premium over competing vegetable oils could cap near-term price upside.
“Hence, we forecast inventories to rise 2.1 per cent month-on-month (m-o-m) to 2.68 million tonnes in August 2026, as higher production (+3 per cent m-o-m) more than offsets stronger exports (+6 per cent m-o-m),” it said.
As such, CIMB Securities reiterates an “overweight” call on the plantation sector, with IOI Corp, Kuala Lumpur Kepong, and Hap Seng Plantations as its top picks.
-- BERNAMA