CPO prices to hold above RM4,000 in next three months amid tight supply — IOI Corp CEO

PUTRAJAYA (Nov 4): Crude palm oil (CPO) prices are likely to stay above RM4,000 per tonne over the next three months, supported by tighter supply during the seasonal low production period, said IOI Corp Bhd (KL:IOICORP) managing director and CEO Datuk Lee Yeow Chor.

Lee noted that CPO prices had eased slightly to below RM4,200 per tonne over the past week, mainly due to “unexpectedly high” production in Malaysia — particularly in East Malaysia, where estates are seeing double-digit output growth.

Prices have also been weighed down by China’s resumption of soybean oil imports from the US, he added.

“After the peak in October, we’re now entering the seasonal low production period from November to February. Weather is always a big factor, and with La Niña expected this year — which typically disrupts harvesting and output — we foresee production and stock levels declining in the coming months," he said at a press conference after the group's annual general meeting.

“This should create a supportive environment for palm oil prices to stay healthy — and by healthy, I mean above RM4,000 per tonne over the next three to four months,” he added.

The benchmark CPO futures contract for February 2026 delivery closed at RM4,168 per tonne on Bursa Malaysia Derivatives on Tuesday.

To double organic palm oil acreage by 2027

IOI Corp plans to double its organic palm oil cultivation area to 2,500ha by 2027, from the current 1,128ha.

Lee said organic oil palm cultivation holds strong potential in premium markets that value sustainability, traceability, environmental stewardship and healthier product choices.

“We started last year and have already begun selling organic palm oil at a good premium, particularly to markets like Europe,” he said. “Given the encouraging response, we decided to expand our organic palm oil acreage by about double. The certification process takes three years, as we must demonstrate consistent organic practices before the palm oil can be certified.

‘Organic’ means avoiding all forms of chemicals — whether fertilisers or pesticides, Lee said. "It involves not so much investment but more innovation — transforming long-standing practices of nearly 100 years that relied on chemical fertilisers and pesticides, and finding alternative methods," he added.

IOI Corp shares eased three sen to close at RM4.04 on Tuesday, valuing the integrated plantation group at RM25.39 billion.