Demand drives early September palm prices, shipping costs soften
1 RM (Malaysian Ringgit) = 0.24 USD
1 USD = 0.74 GBP
*Exchange rates calculated and market prices reported on 3rd September, 2025
Crude Palm Oil
Average World Bank August 2025 palm oil price
US$1,026/tonne (+US$50)
Malaysia palm market
Prices hold steady in August
Malaysian palm oil prices were relatively stable during August trading in a range from RM4,195/tonne (US$1,007) on the 2nd August to RM4,553/tonne (US$1,093) on the 18th of the month.
The Malaysia CPO settlement price ended the month at RM4,383/tonne (US$1,052) as the gains made earlier in August were eroded. That price was 3.7% more than at the start of the month and 9.6% more than the year before. However, it was still 38.3% less than the all-time high set in April 2022.
Early September price increases
Malaysian prices rose a little in early September, driven by stronger demand following the softening of values at the end of August. Strong exports also supported prices.
Official Malaysian Palm Board usage and trade figures are not available yet, but cargo surveyors estimate that August exports were between 10% and 15% more than July. Indian palm oil imports were at their highest for more than a year in August as buyers switched from buying more expensive soyoil to better value palm oil.
Malaysia is not alone in exporting more palm oil. Indonesia exported 13.64 million tonnes of palm oil in the seven months between January and July 2025, 10.9% more than the same period last year.
Malaysia CPO Settlement Price RM
Vegetable oil
Vegetable oil prices edge up in August
Average global palm oil prices rose 5.1% in August to US$1,026/tonne, a 10% increase on the year, according to the World Bank. Palm kernel oil prices were up 8.0% in the month and by 53% over the year to US$2,264/tonne.
There was a mixed performance for other vegetable oils. Soybean oil dropped 4.7% in price over the month to an average of US$1,244/tonne, but that was up 20.7% over the year. Rapeseed prices were up 0.9% in the month and by 12.3% over the year to US$1,213/tonne. Sunflower oil gained the most of the main vegetable oils – up 4.9% in the month and by 21.5% over the year to US$1,274/tonne.
Average world soybean oil prices in US$/tonne
Rapeseed oil
Average world rapeseed oil price in US$/tonne
Sunflower oil
Average world sunflower oil prices in US$/tonne
Shipping update
Prices down by almost two-thirds from a year ago
The Drewry World Container Index fell throughout August and is now back to where it was before the spike in costs during June.
The latest index on Thursday, 28th August, was US$2,119 per 40-foot container, a drop of 6% on the week before. That was 40% less than in mid-June and down 61% compared to the year before. It represented almost three months of declines, with further falls in costs expected.
From the 28th August Drewry World Container Index report:
- Drewry's World Container Index (WCI) declined for the 11th consecutive week, and we expect it to continue falling in the coming weeks. The unpredictability began after US tariffs were announced in April, which caused rates to surge from May through early June, but they plunged thereafter until mid-July and continued to decline till this week.
- Transpacific spot rates fell this week, as rates on Shanghai–Los Angeles fell 3% ($2,332/feu) and those on Shanghai–New York reduced 5% ($3,291/feu). The phase of accelerated purchasing by US retailers, which induced an early peak season, has ended. In response to a decelerating US economy and increased tariff costs, they are now scaling back on procurement but at a measured pace. Hence, Drewry expects rates on this trade lane to continue declining in the coming weeks.
- Asia–Europe spot rates fell this week, as rates on Shanghai–Rotterdam reduced 10% ($2,661/feu) and on Shanghai–Genoa slid 5% ($2,842/feu). Despite healthy demand and port delays in Europe, a growing surplus of vessel capacity has been pushing down spot rates on this trade lane. Therefore, Drewry predicts a further decline in spot rates in the coming weeks.
- Drewry’s Container Forecaster expects the supply-demand balance to weaken again in 2H25, which will cause spot rates to contract. The volatility and timing of rate changes will depend on Trump’s future tariffs and on capacity changes related to the introduction of US penalties on Chinese ships, which are uncertain.
Source: Drewry Supply Chain Advisors
Disclaimer: The information in this document has been obtained from or based upon sources believed to be reliable and accurate at the time of writing. The document should be for information purposes only and is not guaranteed to be accurate or complete.