Jakarta. Palm oil prices steadied after recent volatility, with the benchmark contract trading at 4,236 ringgit ($1,078.57) a ton on Feb. 4, up 0.6% from the previous session, according to tradingeconomics.com. Prices have gained 5.6% over the past month but remain 2.2% lower than a year earlier, based on a contract-for-difference tracking the benchmark market.

Malaysian palm oil futures had slipped for a second straight session earlier in the week, falling below 4,200 ringgit a ton and hovering near their lowest level in a week as trading resumed after a public holiday. The market was pressured by declines in Dalian edible oils and a firmer ringgit, which tends to reduce export competitiveness.

Sentiment was also dampened by weak official purchasing managers’ index data from China, the world’s second-largest economy and a key consumer of vegetable oils. 

Losses, however, were partially cushioned by stronger import demand from India, the world’s largest palm oil buyer. Shipments into the country surged 51% in January to a four-month high, as palm oil’s steep discount to rival soyoil encouraged refiners to step up purchases, according to trade data.

Supply-side developments in Southeast Asia remain supportive. Intertek Testing Services reported that Malaysian palm oil product exports rose 17.9% in January to 1.46 million metric tons from December. In Indonesia, the world’s top producer, exports of crude and refined palm oil climbed 9.1% last year to 23.61 million tons, the Central Statistics Agency (BPS) said.

Palm oil continues to be a major source of foreign exchange for Indonesia. Exports of crude palm oil and its derivatives totaled $24.42 billion in 2025, up nearly 22% from a year earlier, according to the Central Statistics Agency. December shipments alone reached 2.75 million tons, more than doubling from November and rising almost 67% from a year earlier.

However, President Prabowo Subianto has signaled a shift toward prioritizing palm oil for local use as part of his national agenda, which places energy self-sufficiency at its core. The government is ramping up production of palm-based biodiesel and aviation fuel, potentially tightening global supply.

Under the policy, crude palm oil and its by-products — including used cooking oil — are being directed toward domestic biofuel production, with exports facing tighter restrictions. While officials argue the strategy will reduce reliance on imported fuel and stabilize energy costs, industry players have warned that stagnant production growth could force a trade-off between exports and domestic mandates.