22/01/2026 (Oils & Fats International) - The Malaysian Palm Oil Board (MPOB) will introduce an official used cooking oil (UCO) reference price in the first quarter of 2026, according to an Eco-Business report.

MPOB – the statutory body which oversees the regulation, research and development of the country’s palm oil industry – said the move was aimed at improving market transparency, guiding fair trading and strengthening the development of a circular palm oil economy.

The benchmark was expected to provide clearer price signals while protecting smaller market participants from price manipulation and misinformation, Malaysia’s Plantation and Commodities minister Noraini Ahmad was quoted as saying in the 20 January report.

“The initiative supports Malaysia’s push towards a circular economy, where waste and by-products are converted into valuable industrial and energy resources,” Ahmad was reported as saying in a 13 January New Straits Times article.

MPOB director general Dr Ahmad Parveez Ghulam Kadir added that the reference price was based on the local delivered price, reflecting UCO sold within Malaysia and including local transport costs, rather than export-based free on board (FOB) pricing.

“It (the reference price) is to make it more transparent, so that people have a reference whenever they would like to sell whatever UCO they have collected. This will help ensure that they get a good price and that the market is more regulated,” Kadir was quoted as saying in a 13 January report by The Edge Malaysia.

“Basically, we want to make sure it becomes a healthy business … and that more people are encouraged to collect and sell.”

Last year, UCO prices in Asia hit a two-year high due to stronger demand in Chinese and European markets, S&P Global Commodity Insights reported in January 2025.

The initiative comes after Malaysia’s palm oil industry, the world’s second largest producer after Indonesia, recorded its highest ever amount of crude palm oil (CPO) produced in 2025.

Palm oil output reached 20.28M tonnes in 2025 but is expected to moderate to between 19.5M-19.8M tonnes this year, The Edge Malaysia cited Kadir as saying in a 21 January report.

https://www.ofimagazine.com/news/malaysia-to-introduce-uco-reference-price-in-first-quarter-2026