Indonesia’s palm oil industry is poised for a production boost in 2025, with crude output expected to reach 50 million metric tons, up from 48.2 million tons last year. However, exports are projected to fall to 28 million tons, down from 29.5 million tons, as domestic consumption surges.
Key Highlights
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The increase in output is attributed to improved yields and replanting efforts, especially by private estates.
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Aging plantations and slow smallholder rejuvenation continue to limit longterm productivity gains.
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Domestic demand is rising due to the nationwide rollout of the B40 biodiesel mandate, which requires 40% palm oil blending in diesel.
Export Dynamics
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Export volumes are expected to decline for the second consecutive year, driven by biodiesel expansion and tighter supply for overseas markets.
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Key buyers like India and China are shifting toward alternative oils due to price competitiveness and sustainability concerns.
Sources: Palm Oil Magazine, Tempo.co, CropGPT.ai, USDA Jakarta Attaché.