IOPRI forecasts that output in the world's top producing nation will reach 49.42 million tonnes in 2022 compared to an estimated 48.4 million tonnes this year.
"Malaysia CPO reference prices is up for 10 straight months and Indonesia is likely to follow suit when it announces its April CPO export tax," Varqa added.
The ringgit -- palm's currency of trade -- fell 0.3% against the dollar on Wednesday, making the commodity cheaper for holders of other currencies. It has lost nearly 3% of its value so far this year.