What are the two main drivers pushing palm oil prices to their highest level since December 2024?

The two main drivers are rising biofuel demand—particularly from Indonesia's newly launched B50 mandate, which diverts more palm oil into fuel and reduces exports—and supply constraints caused by El Niño-induced dryness in Indonesia and Malaysia, which is weighing on production and contributing to a forecasted nine-year low in global palm oil reserves for the 2026–27 season.

Why are buyers turning to palm oil amid recent disruptions in the Black Sea?

Recent attacks in the Black Sea have slowed crop exports from Russia and Ukraine—a major source of sunflower oil—to a trickle, prompting buyers to seek alternative vegetable oils, including palm oil, to fill the supply gap.

Palm Oil Hits Highest Level Since 2024 on Biofuel Demand, El Niño Supply Constraints

Aug 19, 2026

Palm oil prices climbed to a 20-month high driven by Indonesia's B50 biofuel mandate and El Niño-related supply risks. USDA forecasts global reserves to fall to a nine-year low in the 2026-27 season.

bloomberg

2026-08-19

Palm Oil Hits Highest Level Since 2024 on Biofuel Demand, El Niño Supply Constraints

Palm Oil Hits Highest Level Since 2024 on Biofuel Demand, El Niño Supply Constraints

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