PALMOILMAGAZINE, KUALA LUMPUR – Crude palm oil (CPO) futures on the Bursa Malaysia Derivatives Exchange rebounded on Friday (June 26, 2026), supported by Indonesia’s confirmation that the mandatory B50 biodiesel program will officially take effect on July 1.
According to Reuters, the benchmark September 2026 CPO contract gained RM40 per metric ton, or approximately 0.88%, reaching RM4,597 per ton during the midday trading session.
The price increase followed Indonesia’s issuance of regulations on Thursday (June 25) formally implementing the B50 biodiesel mandate. Market participants expect the policy to significantly increase domestic palm oil consumption, potentially reducing export availability and tightening global supply balances.
Also Read: Indonesia Accelerates B50 Rollout as Cross-Sector Testing Advances Ahead of July Launch
Despite Friday’s recovery, Malaysian palm oil futures still recorded a weekly decline of approximately 1.05%, reflecting earlier market pressure during several trading sessions.
Indonesia’s domestic market also showed stronger prices. Crude palm oil sold through PT Kharisma Pemasaran Bersama Nusantara (KPBN) was set at IDR 15,575 per kilogram on Friday.
The price represented an increase of IDR 225 per kilogram, or around 1.47%, compared with IDR 15,350 per kilogram recorded on Thursday.
Also Read: Indonesia to Launch B50 in July as Prabowo Pushes Palm Oil-Led Energy Transition
Under the newly issued regulation, Indonesia’s B50 biodiesel mandate will become effective on July 1, 2026. The government has also provided a three-month transition period, allowing fuel distributors to clear existing biodiesel inventories before fully adopting the 50% biodiesel blend.
The policy is widely viewed as a positive development for the palm oil industry, as it is expected to substantially increase domestic palm oil absorption. Higher local consumption could help support CPO prices amid ongoing volatility in global vegetable oil markets.
Apart from Indonesia’s biodiesel policy, stronger Malaysian export performance also contributed to the bullish sentiment.
Data from independent inspection company AmSpec Agri Malaysia showed that Malaysian palm oil product exports during June 1–25 rose approximately 11.1% compared with the same period in the previous month.
Meanwhile, cargo surveyor Intertek Testing Services reported a 10.6% increase in Malaysian palm oil exports during the same period, indicating that global demand for palm oil remained resilient toward the end of June.
Other vegetable oil markets also posted gains. The most active soybean oil contract on the Dalian Commodity Exchange rose about 0.81%, while Dalian palm oil futures advanced 1.22%.
Also Read: Palm Oil as a Renewable Natural Resource
In contrast, soybean oil futures on the Chicago Board of Trade (CBOT) fell approximately 0.73%, highlighting mixed sentiment across the global vegetable oil market.
Supported by Indonesia’s biodiesel policy, stronger Malaysian exports, and gains in competing vegetable oils across Asia, market participants are now closely watching the impact of B50 implementation on palm oil demand in the coming months. (P3)
