Malaysia expects crude palm oil to cost between 3,900 to 4,100 ringgit a ton by 2026.

Due to increased global production, the Malaysian government expects that crude palm oil prices will range between 3,900 Ringgit ($925.05), and 4,100 Ringgit ($4,100.05), per metric ton in 2019.

The benchmark crude palm-oil contract traded at 4,589 Ringgit on Thursday, with an average price for the year of 4,252 Ringgit.

In its Economic Outlook report, released Friday along with its 2026 Budget, the government stated that it expects to see a higher crude palm oil production in 2026 due to improved oil extraction rates and increased fresh fruit bunches.

The weather is expected to be favorable, and the output will likely increase due to the expansion of matured planting areas, improvements to harvesting techniques, as well as a continued switch to mechanisation.

The government said that improved OER will result from increased harvesting and better management of the fields. This is likely to improve fruit quality and reduce loss.

It said that "these developments will give a boost to the overall growth of the oil palm sector during the year."

The report stated that exports of agricultural products are expected to grow by 3,3% next year due to the competitive prices and global demand for palm oils and palm oil-based agricultural product.

(source: Reuters)