Malaysian Palm Oil Exports Performance to China
(Jan- Aug 2019)
A Review on MPO Export Performance
For the period of Jan – Aug 2019, Malaysia’s palm oil exports to China/HK increased by 129,585 MT or by 12.3% to 1,409,686 MT. One of the main reason for the increased exports was the lower crushing of soybeans in the first half of 2019 which was brought about by the African swine fever (ASF). The effect of ASF was more severe and/or widespread than expected and reduced China’s need for soybeans which drove price of local soybean oil up. As a result, demand for other oils, particularly palm oil increased and this can be seen in the overall import of palm oil during this period which rose by more than 1 million MT compared to the same period of 2018.
|Table 1 : Malaysian palm oil export to China/HK|
|Jan – Aug 2019||Jan – Aug 2018||Difference (MT)||Difference (%)|
|Source : MPOB|
Another reason for the rise in China’s palm oil import can be partially attributed to the effect of the US-China trade war. On July 6, 2018, China imposed additional 25% tariff on US soybean import on top of the existing 3%. This is in addition to the 25% tariff is imposed for the import tariff on both soybean and soybean meal from USD. It was also reported that additional tax on soybean will be further raised to 30% on 1st September, 2019.
|Jan-Jul 2019||Jan-Jul 2018||Changes (Vol.)||Changes (%)||Jan-Dec 2018|
As for palm products, RBD Palm Olein, RBD Palm Stearin and Crude Palm stearin are the major types of palm oil exported accounting for 92.7% of the total exports. This share is 4.7% lower than the 97.4% in the corresponding period last year. There was a 13.7% decrease in CPS import by 21,661 MT to 136,125 MT. Meanwhiile, RBD PS imports rose by 59.6% or 103,594 MT to 277,311 MT.
|Table 2: Malaysian Palm Products Export to China / HK |
|Product||Jan- Aug 2019||Jan-Aug 2018||Diff (MT)||Diff (%)|
On a month to month basis, Malaysia’s palm oil exports to China increased by 239.2% or 218,277 MT from 91,271 MT in July, 2019 to 309,548 MT in August 2019. With USA-China trade war escalating, it is expected that this factor will continue to support growth of Malaysian palm oil exports to China. As it is, China’s palm oil import recorded substantial increase for Jan.-July 2019 period. During this period, palm oil imports was at 3,914,600 MT, 37.2% or 1,060,000 MT higher than the import for the same period of last year of 2,853,800 MT.
Source : MPOB
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