Palm Oil Market in November 2026: Downward Price Pressure Intensifies Amid Supply Recovery

The global palm oil market, represented by futures prices on the Bursa Malaysia Derivatives (BMD) exchange, is experiencing notable volatility in November 2026. After a period of maintaining high levels, palm oil prices are facing significant downward correction pressure. This article provides an in-depth analysis of actual price movements, the causes of the decline, and the macroeconomic factors impacting this vital vegetable oil market, offering insights for businesses and investors in Vietnam.

Overview of Global and Vietnamese Crude Palm Oil (CPO) Price Trends

Based on actual market data as of early November 2026, the downward trend in palm oil prices has become very clear. This is a continuation of the correction that began last month.

Specifically, the average price for October 2026 was recorded at 4,679.42 MYR/mt (equivalent to approximately 26,122,301 VND/ton). Entering November, the average price to date has fallen to 4,550.80 MYR/mt (approximately 25,404,295 VND/ton). This indicates a significant decline in the general price level.

Observing daily price data from the beginning of November further reinforces the assessment of a downward trend:

• November 1, 2026: 4,681.00 MYR/mt (26,131,121 VND/ton)
• November 2, 2026: 4,649.00 MYR/mt (25,952,485 VND/ton)
• November 3, 2026: 4,551.00 MYR/mt (25,405,411 VND/ton)
• November 4, 2026: 4,496.00 MYR/mt (25,098,380 VND/ton)
• November 5, 2026: 4,377.00 MYR/mt (24,434,077 VND/ton)

In just the first 5 days of the month, palm oil prices fell from a high of 4,681.00 MYR/mt to 4,377.00 MYR/mt, a drop of more than 300 MYR per ton, equivalent to a decrease of over 6.5%. Although there was a slight recovery on November 5 (+0.14% compared to the previous session), the dominant trend remains bearish.

In the Vietnamese market, due to almost complete reliance on imported palm oil (primarily from Malaysia and Indonesia), domestic raw palm oil prices are fluctuating in tandem with global prices. The current converted price of approximately 24,434,000 VND/ton (excluding import taxes, shipping fees, and other costs) is exerting downward price pressure on downstream products such as edible cooking oil, cosmetics, and animal feed.

Analysis of Causes Behind the Price Decline

The sharp decline in palm oil prices in early November 2026 is not coincidental but the result of a combination of fundamental supply-demand factors and market sentiment.

1. Pressure from Recovering Supply

The most important factor currently impacting palm oil prices is the positive supply outlook from the two largest producing nations, Indonesia and Malaysia. After a period affected by unfavorable weather (such as the previous El Niño phenomenon), palm plantations are entering a peak harvest period with improved yields. Forecasts of increased production have eased concerns about supply shortages, thereby pushing prices down.

2. Rising Inventory Levels

Accompanying the increase in production is a rise in inventory levels in exporting countries. As new supply hits the market faster than the rate of consumption, selling pressure from producers increases to clear warehouses, forcing them to accept lower prices. Data from the Malaysian Palm Oil Board (MPOB) is closely monitored by the market, and recent reports show a trend of inventory accumulation.

3. Competition from Other Vegetable Oils

Palm oil does not stand alone in the vegetable oil market. Its price is heavily influenced by the prices of substitute oils, particularly soybean oil and sunflower oil. Currently, the favorable soybean crop outlook in the US and South America (such as Brazil and Argentina) is also exerting downward pressure on soybean oil prices at the Chicago Board of Trade (CBOT). When soybean oil prices fall, it becomes more competitive compared to palm oil, forcing palm oil prices to adjust downward to maintain its appeal to importers.

4. Weakening Import Demand from Key Markets

Demand from major importing nations like India and China is showing signs of stagnation. In India, domestic vegetable oil inventory levels are already quite high following a previous period of strong imports. In China, slow economic recovery and large inventory volumes are also reducing new purchase demand. Weakening demand while supply is increasing is a classic formula for price declines.

Analysis of Macroeconomic Impacts on Palm Oil Prices

Beyond fundamental supply and demand factors, palm oil prices are also strongly influenced by the global macroeconomic environment.

1. Monetary Policy and Exchange Rate Fluctuations

Palm oil prices in Malaysia are denominated in Ringgit (MYR). Therefore, the strength of the MYR against the US Dollar (USD) has a direct impact on prices. When the MYR weakens against the USD, palm oil becomes cheaper for international buyers holding USD, which can stimulate demand. Conversely, if the MYR strengthens, it can reduce the competitiveness of Malaysian palm oil. In the context of potential interest rate adjustments by the US Federal Reserve, the volatility of the USD/MYR exchange rate is a factor that needs to be closely monitored.

2. Global Crude Oil Prices

Palm oil is not only a food product but also an important raw material for producing biodiesel. Therefore, palm oil prices have a positive correlation with global crude oil prices. When crude oil prices rise, the demand for using palm oil for blending into biodiesel increases (due to higher economic viability), thereby pushing palm oil prices up. Conversely, when crude oil prices fall, the pressure on palm oil prices also decreases. Current fluctuations in crude oil prices, influenced by geopolitical factors and global economic prospects, are a key macroeconomic factor impacting the palm oil market.

3. Trade and Tax Policies

Export tax policies of Indonesia and Malaysia, as well as import taxes in India and the European Union (EU), have an immediate impact on trade flows and prices. For example, if Indonesia decides to lower export taxes to boost sales, global prices may fall. Conversely, if India increases import taxes to protect its domestic vegetable oil industry, import demand will decrease, putting pressure on prices in exporting countries. Additionally, EU environmental regulations (such as the EU Deforestation Regulation - EUDR) are creating technical barriers, affecting long-term demand for palm oil.

4. Global Economic Outlook

The health of the global economy affects the general demand for all commodities, including palm oil. If the world economy slows down or enters a recession, food and industrial consumption demand will decrease, thereby lowering palm oil prices. The recovery of the Chinese economy, the world's second-largest importer of vegetable oil, is an extremely important macroeconomic factor to watch.

Insights and Recommendations

Currently, the palm oil market is in a clear downward correction phase. Pressure from recovering supply in Southeast Asia, rising inventories, and competition from soybean oil are the main factors governing the market.

For Vietnamese businesses, especially those importing and using palm oil as a production raw material (such as cooking oil, instant noodle, confectionery, and animal feed companies), this downward trend offers an opportunity to optimize input costs. However, in a global market still characterized by many macroeconomic uncertainties (regarding exchange rates, crude oil prices, and trade policies), businesses need to remain cautious.

Recommendations:

• Monitor closely: Continuously update reports on production and inventory from the MPOB (Malaysia) and GAPKI (Indonesia), as well as soybean oil price movements on the CBOT and crude oil prices.
• Price risk management: Use commodity derivatives to lock in import prices and hedge against unexpected market volatility.
• Flexible procurement strategy: Take advantage of deep downward corrections to purchase inventory, but avoid over-stocking when the downward trend shows no clear signs of ending.
• Diversify supply sources: Although heavily dependent on Malaysia and Indonesia, seeking and establishing relationships with other suppliers or considering alternative oils is also a way to mitigate risk.

In summary, November 2026 is witnessing a shift in the palm oil market that is favorable for buyers. However, understanding the core causes and the macroeconomic factors at play is key for businesses to make sound and effective business decisions.