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Palm oil: “Indonesia Production led BMKS vs Malaysia Pricing led FCPO”
Market Insight

25 August 2026

Palm oil: “Indonesia Production led BMKS vs Malaysia Pricing led FCPO”

In 2025, Indonesia's palm oil production reached 51.66 million tons, significantly outpacing Malaysia's output of 20.28 million tons; more than half of global palm oil exports originate from Indonesia. However, global trade is confronted with an unavoidable awkward reality: the goods are in Indonesian, but the prices are from Malaysian. Currently, all pricing mechanisms – including spot trading, hedging, and long-term contract pricing – in the global palm oil trade are anchored to the FCPO futures contract traded on the…

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