Malaysia’s Palm Oil Juggernaut Rolls On — August Shipments Surge Past 1.3M Tons

Malaysia’s palm oil exports witnessed a notable uptick in August 2025, rising to an estimated 1,341,990 metric tons, up from 1,163,216 metric tons in July, according to data released by cargo surveyor AmSpec Agri. This 15.3% month-on-month increase reflects a rebound in global demand and signals renewed momentum in the vegetable oils market, despite ongoing volatility in commodity prices and currency fluctuations.

 

The export surge comes amid broader market dynamics, including rising crude palm oil (CPO) production, shifting trade policies, and seasonal buying patterns from key importers such as India, China, and the European Union.

 

A Rebound After July’s Dip

July had seen a dip in Malaysia’s palm oil exports, with AmSpec reporting a 9.6% decline from June’s figures. The August recovery suggests that buyers returned to the market, possibly taking advantage of price corrections and favorable currency exchange rates. The Malaysian ringgit weakened against the U.S. dollar during the month, making palm oil more attractive to foreign buyers2.

 

This export growth is particularly significant given the backdrop of rising domestic palm oil stocks. According to the Malaysian Palm Oil Board (MPOB), stocks rose 7.34% in August to 1.88 million metric tons, the highest level since February. The increase in exports may help ease inventory pressure and stabilize prices in the coming months.

 

Global Market Drivers

Several factors contributed to the August export boost:

Additionally, Indonesia’s decision to adjust its crude palm oil reference price for September to $839.53 per metric ton—up from $820.11 in August—may have nudged buyers toward Malaysian suppliers.

 

Price Movements and Market Sentiment

Despite the export surge, palm oil futures on the Bursa Malaysia Derivatives Exchange experienced a correction in early September. The benchmark contract for November delivery fell 1.11% to 3,933 ringgit ($903.10) per metric ton, driven by profit-taking and losses in related markets such as Dalian’s palm and soyoil contracts.

 

Market analysts suggest that while export volumes are encouraging, price volatility will persist due to macroeconomic uncertainties, currency fluctuations, and policy shifts in importing countries. India’s potential move to increase import duties on vegetable oils could dampen future demand, while China’s economic slowdown remains a concern.

 

Production Trends and Outlook

Malaysia’s crude palm oil production rose 2.87% in August to 1.89 million metric tons, the highest monthly output since October 2024. This surge in production, coupled with rising exports, paints a mixed picture for the industry: while supply is strong, maintaining demand will be key to preventing oversupply and price erosion.

 

Looking ahead, industry watchers expect September exports to remain robust, supported by seasonal buying and competitive pricing. However, traders are closely monitoring Indonesia’s biodiesel policy and export levy adjustments, which could influence regional competitiveness.

 

Sustainability and Strategic Positioning

Malaysia continues to position itself as a reliable and sustainable supplier of palm oil, with ongoing efforts to improve traceability, reduce deforestation, and meet global ESG standards. The government and industry stakeholders are working to enhance certification schemes and promote responsible sourcing to maintain access to premium markets.

 

As the world’s second-largest producer of palm oil, Malaysia’s ability to balance production, exports, and sustainability will be crucial in navigating the evolving global landscape.

 

Sources: MPOB, SunSirs, Reuters