Cooking Oil Markets in 2026: Why Palm and Sunflower Prices Are Rising and What It Means for West Africa and the Middle East

The global vegetable oil complex has tightened considerably through 2026. Both palm and sunflower oil — the two workhorses of food processing and household cooking across West Africa and the Middle East — are trading at elevated levels, and the structural drivers behind those prices show little sign of reversing quickly. For importers, distributors and food manufacturers operating in these regions, understanding what is pushing costs higher is essential for procurement planning and margin management.

Palm Oil: Supply Pressures Building on Two Fronts

The benchmark Malaysian crude palm oil (CPO) price reached 4,681 MYR/MT on 30 October 2026, up roughly 11% year-on-year in USD terms, with September 2026 global prices averaging approximately $1,133/MT compared with $1,035/MT a year earlier. The 2026 year-to-date average of around $1,101/MT sits meaningfully above the full-year 2025 average of $997/MT.

Two interrelated supply-side forces are responsible. In Indonesia, the world's largest palm oil producer, around 1.5 million hectares of oil palm plantations have already been transferred to state control, with a further 1.8 million hectares under verification — a policy shift that analysts estimate could put between 2 and 5 million tonnes of CPO output at risk. Simultaneously, Indonesia's biodiesel blending mandate is absorbing an increasing share of domestic production: a B45 mandate is being implemented in 2026, with B50 blending anticipated toward year-end, diverting supply away from export channels. Looking into 2027, the Malaysian Palm Oil Council projects Indonesian production and exports will decline as domestic biodiesel demand firms further.

In Malaysia, Fastmarkets projects CPO output to ease to approximately 19.6 million tonnes in 2026, down around 400,000 tonnes year-on-year, constrained by stagnant planted area, aging tree stock and dependence on foreign labour. Malaysian export volumes are forecast to hold at around 16 million tonnes, and the MPOC expects Malaysia to play a larger global role in 2027 precisely because Indonesian availability is expected to shrink. That rebalancing may provide some supply continuity, but it is unlikely to bring meaningful price relief.

Sunflower Oil: Black Sea Constraints Keep Prices Firm

Sunflower oil tells a similarly tight story. On a bulk commodity basis, US prices reached approximately $1,411/MT in June 2026, up from around $1,351/MT in Q1 2026, while Indian import prices stood near $1,344/MT over the same period. The primary driver remains restricted sunflower seed availability from Ukraine and Russia, the Black Sea region that accounts for the majority of global sunflower supply. With no near-term resolution in sight, prices through August 2026 continued to track close to first-half levels, and the 2026 full-year average is forecast in a firming range of $1.35–$1.39/kg for sunflower seed — which flows directly into refined oil costs.

West Africa: A Structurally Import-Dependent Market Under Pressure

Against this backdrop of elevated global prices, West Africa's demand picture is one of durable, growing import reliance. The region produced approximately 2.8 million metric tonnes of palm oil in 2025, while Africa as a whole consumed roughly 9.1 million tonnes in 2024 — leaving a deficit of around 5.7 million tonnes filled almost entirely by Southeast Asian imports. West Africa imported roughly 6.2 million tonnes of palm oil in 2024 to bridge that gap, with refined palm oil accounting for close to 80% of African imports, reflecting both consumer preference and the limited regional refining infrastructure.

Africa now holds a 12.7% share of the global palm oil market and is the fastest-growing regional market, underpinned by population growth and rising consumption of processed foods. Nigeria's palm oil market alone is projected to expand by 40–60% cumulatively between 2026 and 2035. However, foreign exchange volatility and import logistics in Nigeria continue to translate global price increases into sharp swings in landed costs, squeezing margins for food processors and retailers and creating periodic supply disruptions that distributors must plan around carefully.

At the global level, the USDA projects food processing consumption of palm oil at 54.8 million metric tonnes for the 2025/2026 marketing year, underscoring how central this commodity is to the food supply chains that Dairy Land's partners operate within.

Takeaway for Buyers and Distributors

The combination of Indonesian supply risk, rising biodiesel mandates, flat Malaysian output growth and persistent Black Sea constraints on sunflower oil suggests that the current period of elevated vegetable oil prices is structural rather than transitory. For buyers in West Africa and the UAE, forward procurement planning, supply-source diversification and close attention to FX costs in import-heavy markets like Nigeria will be the key levers available to protect margins through at least the first half of 2027.