InfoSAWIT, KUALA LUMPUR – Malaysia’s palm oil exports are projected to remain around 16 million tonnes in 2027, even as palm oil production in both Malaysia and Indonesia is expected to decline, according to the Malaysian Palm Oil Council (MPOC).
According to information reported by InfoSAWIT from Bernama on Friday (25/9/2026), the projection is based on independent global market analysis and forecasts from Oil World.
MPOC estimates that Indonesia’s palm oil production could fall by approximately 1.9 million tonnes in 2027, while Malaysia’s output is expected to decline by around 700,000 tonnes.
The decline in Indonesian production is also expected to affect exports. Indonesia’s global palm oil shipments could fall by nearly 3 million tonnes in 2027, mainly as domestic demand rises under the country’s biodiesel blending program and production prospects weaken.
The projected reduction in Indonesian export availability could increase Malaysia’s role in supplying international palm oil markets. However, MPOC’s projection of exports at around 16 million tonnes will depend on the development of domestic production, stocks, consumption and demand from importing countries.
Malaysia’s August Production Edges Higher
Malaysia’s palm oil production reached 1.81 million tonnes in August 2026, up 1.4% from July. The monthly increase was supported by higher fresh fruit bunch collection and an improvement in the oil extraction rate.
Despite the monthly rise, production remained below the level recorded in the same month a year earlier. The decline marked the sixth consecutive year-on-year drop since March 2026.
Malaysia’s cumulative exports from January through August 2026 reached approximately 10.4 million tonnes, an increase of 806,000 tonnes from the corresponding period a year earlier.
However, August shipments declined 7.5% month-on-month to 1.29 million tonnes, with weaker exports to South Asia and the Middle East contributing to the decline.
The developments point to changing supply dynamics in the global palm oil market. Lower production in Indonesia and Malaysia, combined with stronger domestic biodiesel demand in Indonesia, could reduce export availability and alter the balance of global supply.
For Malaysia, maintaining export volumes near 16 million tonnes in 2027 will depend on how production, inventories, domestic consumption and international demand evolve. (T2)
