Haitong Futures: With favorable policies for biodiesel and added support from weather-related risks, the medium- to long-term bullish outlook for palm oil prices remains unchanged

The Indonesian Ministry of Energy and Mineral Resources issued document number B-3487 on April 21, officially ordering the nationwide enforcement of the B50 biodiesel blending policy for all types of diesel starting from July 1, 2026. As Indonesia increases the biodiesel blending ratio to B50, the demand for biodiesel raw materials is expected to rise to approximately 15 million tons this year, an increase of about 2 million tons compared to the previous year’s B40 standard. On the other hand, the National Climate Center released a forecast indicating that China may enter an El Niño state in May this year, with a moderate to strong El Niño event likely to form during the summer, and this phenomenon is highly likely to persist until the end of the year. El Niño weather conditions often lead to reduced palm oil production in major producing countries, further intensifying market concerns over supply. Supported by favorable policies for biodiesel and weather risks, the medium- to long-term bullish trend in palm oil prices remains unchanged. (Haitong Futures)