October 2025 is shaping up to be a pivotal month for the palm derivatives market, where stability is deceptive and upstream fundamentals dictate every move. The price of RBD Palm Stearin, the foundational raw material for hydrogenation, is a clear reflection of this reality. As we enter the month, indicative FOB prices are hovering in a tight $855-$870 per metric ton range, a notable 2% climb from early September that underscores a market sensitive to the slightest shift in supply.

In such a tightly correlated market, securing a reliable supply chain becomes paramount. Navigating these upstream currents is where experienced partners provide critical value, offering stability in procurement for clients in the oleochemical and derivatives space. For companies like Tradeasia International, understanding these nuances is key to delivering consistent value.

Upstream Pressures Dictate Downstream Prices

The current price firmness for RBD Palm Stearin can be traced directly back to the plantation. September’s Crude Palm Oil (CPO) output, reported by the Indonesian Palm Oil Association (GAPKI) at 4.3 million tons, represented a 4% seasonal dip from August’s peak. This slight but significant tightening of upstream feedstock sent ripples through the refineries, firming up fractionation margins to a healthy $30/ton. The result is a direct, almost one-to-one correlation with CPO futures on the Bursa Malaysia Derivatives, which have now climbed past the MYR 4,200/ton benchmark, pulling stearin prices along with them.

Demand Holds Firm, For Now

While supply dictates the cost, robust demand is what keeps the floor price solid. Hydrogenation facilities, the primary consumers, are running at near-peak capacity of 90-95% to meet orders for specialty fats, absorbing roughly 60% of the available stearin. The remaining 40% is steadily consumed by the oleochemical sector, a fact supported by market data from Palm-Chemicals.com, which shows a 1.5% price increase for downstream products like Palmitic Acid in the last month alone. Traders are now keenly awaiting inventory data from the Malaysian Palm Oil Board; any figure below the expected 1.85 million tons could signal further price support for stearin heading into the final quarter.

Sources:

  1. Market News on Palm & Fatty Acids

  2. Reuters Commodities Market Data

  3. Indonesian Palm Oil Association (GAPKI) Statistics