Fitch expects Malaysian benchmark CPO prices to weaken from 2H2024
25/06/2024 (The Edge Malaysia), Kuala Lumpur - Fitch Ratings expects Malaysian benchmark crude palm oil (CPO) prices to weaken from the second half of 2024 (2H2024), on higher global vegetable oil supply.
In a statement on Tuesday, the international agency said spot prices have weakened after exceeding US$950 per tonne in early April 2024, and Fitch assumes they will average US$775/tonne in 2024.
Fitch said Malaysia’s CPO output in the first five months of 2024 (5M2024) was up 15% year-on-year and the highest since 2019.
“However, palm oil production in Indonesia remained flat in the first quarter of 2024 (1Q2024).
“We expect better rainfall due to La Nina to drive higher output, especially in Indonesia.
“A strong La Nina is a key upside risk for prices, as it could impair production of various vegetable oil crops across the world,” it said.