Climate and Farming Impact – (2024)
Unseasonal rainfall in Malaysia and drought concerns in parts of Indonesia impacted kernel yields and oil extraction rates. The resulting lower output coincided with strong international demand, pushing prices upward. Additionally, sustainability certifications and traceability requirements affected export volumes to the EU, contributing to further price fluctuations.
Feedstock & Logistic Disruptions – (2023)
Prices were influenced by weather-related disruptions in Southeast Asia, port congestion, reduced vessel availability, and fluctuating crude palm kernel oil (CPKO) prices. High inflation and lower inventory levels in major importing countries also added pressure, while regulatory changes in exporting countries led to temporary supply shortages.
Russia-Ukraine War – (2022)
The war led to a sharp rise in global edible oil prices, particularly sunflower oil. As a substitute, demand for Palm Kernel Oil increased significantly, especially in Europe and South Asia. The geopolitical crisis also drove up fertilizer and energy prices, increasing production costs and fueling further price hikes in the palm oil sector.
Post-COVID Demand Recovery – (2021)
As economic activity resumed, demand for Palm Kernel Oil surged, particularly in food processing, soap manufacturing, and cosmetics. With increased consumer demand and export orders from China and India, prices rebounded sharply. Tight labor availability in Malaysia and Indonesia also slowed production recovery, contributing to rising prices.
The COVID-19 Pandemic – (2020)
Global lockdowns and labour shortages severely disrupted palm oil plantation operations and refining activities, including Palm Kernel Oil. The supply chain was further impacted by port closures and restricted transportation. As demand from the food and personal care sectors dropped temporarily, many processors operated at reduced capacities, causing a temporary oversupply and price volatility.