The increase in crude palm oil (CPO) prices in the second quarter of\n2026 is estimated not to be merely triggered by ordinary market factors,\nbut influenced by global energy dynamics and geopolitical conflicts.\nIndonesia Palm Oil Strategic Studies notes that this trend marks a shift\nin palm oil\u2019s position from a food commodity to a part of the global\nenergy system.<\/p>\n
In the Q2 2026 Palm Oil Outlook, CPO prices are projected to surge\nsignificantly in the coming months. From around US$1,165 per tonne in\nMarch 2026, rising to US$1,440 per tonne in April, then further to\nUS$1,701 in May, and reaching US$1,783 per tonne in June 2026.<\/p>\n
IPOSS assesses that this strengthening is closely related to the rise\nin global energy prices, particularly amid the escalation of conflicts\ninvolving Iran, the United States, and Israel.<\/p>\n
\u201cIn situations like this, CPO is increasingly perceived not only as a\nfood and industrial commodity, but also as a commodity with a strategic\nfunction in the energy system,\u201d states an excerpt from the IPOSS press\nrelease, quoted on Friday (3\/4).<\/p>\n
Global conditions are also expected to directly impact the domestic\nmarket. Domestic CPO prices are projected to rise from around Rp15,065\nper kilogram in March to Rp18,776 per kilogram in April, with the\nstrengthening trend continuing until mid-year. However, price formation\nremains influenced by domestic policies such as export levies and exit\nduties.<\/p>\n
On the supply side, the situation is not entirely loose. National CPO\nproduction and its derivatives until the end of the second quarter of\n2026 is estimated to reach 23.7 million tonnes, slightly below the same\nperiod the previous year. Meanwhile, exports are also projected to\ndecline to 6.70 million tonnes, from 7.22 million tonnes in 2025. This\nmeans the price increase occurs under relatively tighter supply\nconditions.<\/p>\n
IPOSS also highlights other factors complicating the market\nsituation, from seasonal transitions that could trigger droughts in\nproduction centres to the continued high role of domestic biodiesel\nconsumption. The combination of climate, energy, and geopolitical\nfactors makes palm oil price movements increasingly sensitive to\nexternal changes.<\/p>\n
This situation is seen as a reminder that the resilience of the palm\noil industry cannot rely solely on price momentum. IPOSS stresses the\nimportance of maintaining a balance between domestic needs and exports,\nwhile strengthening long-term production foundations.<\/p>\n
Issues of smallholder plantation productivity and accelerating the\npeople\u2019s palm oil replanting programme are said to remain crucial to\nmaintaining supply amid continuously increasing demand. Without\nstructural improvements, price increases risk being unsustainable.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/palm-oil-prices-soar-global-conflicts-as-trigger-1775209853", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }