PALMOILMAGAZINR, JAKARTA – Crude palm oil (CPO) prices extended their upward momentum on Wednesday (June 3, 2026), with gains recorded in both Malaysia’s futures market and Indonesia’s physical market. The rally was driven by rising global crude oil prices, stronger soybean oil markets, and expectations of tighter palm oil supplies in the coming weeks.
Trading resumed after a long holiday break with market participants responding positively to a combination of supportive fundamentals. Chief among them was the sharp rise in global energy prices, which enhanced the attractiveness of palm oil as a biodiesel feedstock and improved sentiment across the broader vegetable oils complex.
Supply-side concerns also contributed to the bullish outlook. Data released by the Southern Peninsular Palm Oil Millers Association (SPPOMA) showed that Malaysian palm oil production during May 1–31, 2026, declined by 10.07% compared with the previous reporting period. The drop reinforced market expectations of tighter near-term supplies, providing additional support for prices.
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Meanwhile, Brent crude oil rose 2.08% to approximately US$98 per barrel during the same trading session. Higher energy prices are generally viewed as supportive for palm oil demand because they improve the economics of biodiesel production, potentially increasing consumption of vegetable oils.
Reflecting the stronger market sentiment, Indonesia’s physical CPO market also moved higher. Prices at PT Kharisma Pemasaran Bersama Nusantara (KPBN) were set at IDR 15,025 per kilogram on Wednesday, up IDR 175/kg, or around 1.18%, from the highest bid recorded on Tuesday at IDR 14,850/kg.
On the Bursa Malaysia Derivatives Exchange, all benchmark palm oil futures contracts closed significantly higher. The June 2026 contract rose RM135 to RM4,605 per tonne, while the July 2026 contract gained the same amount to finish at RM4,638 per tonne.
The August 2026 contract advanced RM142 to RM4,677 per tonne. September and October futures climbed RM144 each, closing at RM4,705 per tonne and RM4,734 per tonne, respectively.
The November 2026 contract added RM141 to settle at RM4,761 per tonne. The broad-based gains across the forward curve reflected growing confidence among traders that palm oil prices will remain supported in the months ahead, particularly as supply concerns persist and energy markets remain firm.
Investor participation also increased substantially. Trading volume surged to 104,077 lots from 76,012 lots recorded before the holiday period, while open interest rose to 289,868 contracts from 285,715 contracts.
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The rise in both trading volume and open interest suggests stronger market engagement and growing confidence in the near-term outlook for palm oil prices. With lower production, stronger energy markets, and positive sentiment across global vegetable oil markets, CPO prices are expected to remain well supported in the weeks ahead. (P3)
