Malaysian Palm Oil Exports Performance to Middle East & North Africa (MENA) Region
(Jan – Aug 2019)
A Review on MPO Performance
Middle East (East of Suez)
|No.||COUNTRY||Jan – Aug 2019||Jan – Aug|
Import of Malaysian palm oil from January to August 2019 declined by 3.88% or 46,480MT which can be attributed mainly by lower imports by Saudi Arabia. The country’s import of Malaysian palm oil dropped by 66.49% or 166,205MT was due to competition with Indonesia who offered much better pricing compared to Malaysia. Based on our industry sources, they claimed that Indonesian palm oil suppliers are offering at least US$10/MT cheaper than Malaysian palm oil. This is reflected in their imports of palm oil from Indonesia as of Jan – June 2019, their imports were recorded at about 200,000 MT whereas in the same period of 2018, import was just 34,000 MT.
The leading importer of MPO from this region is Turkey as imports went up by 71,420 MT or by 16.47%. As Malaysia still benefits from the advantage of having the Malaysia-Turkey FTA which was signed in 2015 which allowed for lower import duties for most products including palm oil, this is reflected in the higher import volume especially since the last two years. However, it was reported that Indonesian has expressed their interest to sign a similar arrangement with Turkey and if implemented could have repercussions for Malaysian palm oil. As for Iran, despite the stricter US sanction, Iran has come back into the market to replenish their depleting stock which saw import of Malaysian palm oil rising by 44.38%.
|No.||COUNTRY||Jan – Aug 2019||Jan – Aug 2018||Diff|
Imports of Malaysian palm oil by the North African market recorded a 48.12% decline, owing to the drop in imports by most of its major markets namely Djibouti, Ethiopia and Egypt. Djibouti, the leading importer of Malaysian palm oil only imported 36,168 MT against 141,288MT in the same period of the previous year. This is because the country, which serves as the gateway to Ethiopian and other Northeast Africa market has been affected by the slow demand from neighbouring countries such as Ethiopia which is currently facing shortage in its foreign currency reserves. This has resulted in a reduction in their imports of Malaysian palm oil tremendously which in the period of January – August declined by 62.03%.
Another major market, Egypt imported only 38,154 MT or by 30.26% over the last eight months as the impact of competition from Indonesia as the reason of slowing imports of palm oil from Malaysia. As of Jan – June 2019, Egypt has been importing over half a million MT of Indonesian palm oil and the volume is expected to grow further as long as Indonesian palm oil is offered at a lower price to buyers in Egypt compared to Malaysian palm oil.
Somalia, on the other hand rose as the leading importers of Malaysian palm oil with imports increase to 19.16% or 9,945 MT. Other markets with positive uptake of Malaysian palm oil are Algeria, Sudan, Libya and Tunisia. However, these market only accounted for 13.06% of the total Malaysian palm oil exported into the North African market.
Breakdown of MPO Exports (MT) Jan – Aug 2019
|PRODUCT||Jan – Aug|
|Jan – Aug|
|Diff (MT)||Diff (%)|
Middle East and North Africa market mostly consume RBD Olein which accounts for 66.24% of the total palm oil imported but imports decline marginally by 7.28%. Import of CO (Cooking Oil accounted for 4% of the total import and the volume was 11.05% higher.
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