Africa (Jan – Feb) 2021

Malaysian Palm Oil Exports Performance to Sub-Saharan Africa Region
(Jan – Feb 2021)
A Review on MPO Export Performance

Table 1: Top Importers of Malaysian Palm Oil from Sub-Saharan Africa

CountryJan – Feb 2021Jan – Feb 2020Difference (Volume)Difference (%)Jan-Dec 2020
South Africa23,22627,386-4,160-15.19212,509
Congo Dem. Rep.15,5764,96410,612213.7647,035
Cote D’Ivoire2,9266,716-3,791-56.4453,799

Source : MPOB

From January – February 2021, the exports of palm oil from Malaysia registered a volume of 286,287 MT, which is a decrease of 23,469 MT or 7.58 % when compared with the same period of 2020 (refer to Table 1). The major reason for the decrease in MPO exports to the region is due to high carry-over stock from the end of last year. In the last few months of 2020, the SSA countries imported higher volume of MPO than normal in anticipation of higher palm oil price in 2021 and the resumption of CPO export duty by the Malaysian government.

Another factor that contributed to the drop in total MPO import is the lower volume of RBD palm olein purchased by the SSA countries due to higher prices of RBD palm olein in 2021. As Sub-Saharan Africa is one of the most price-sensitive regions in the global palm oil market, the upward movement of palm oil price will affect the buying and consumption pattern of palm oil.

Figure 1: Monthly Exports of MPO to Sub-Saharan Africa (MT), 2019-2021

The import of Malaysian palm oil by countries in the Sub-Saharan region in the Jan-Feb 2021 period has reduced by 7.58% compared to the same period last year, from 309,756 MT to 286,287 MT. In terms of product breakdown, CPO/CPL registered the highest increased by 30.03 % from 141,507 MT to 184,004 MT during that period. Despite the rise in CPO prices in the international market in the last few months and Malaysia’s move to resume the crude palm oil export tax at a rate of 8% in January 2021 Malaysian CPO/CPL price is still competitive compared to Indonesian crude palm oil.

Mozambique is the top importer of MPO from the region with a 20.37% increase from 44,633 MT last year to 53,724 MT so far this year. Most of Mozambique import is in the form of CPO/CPL with 47,044 MT of import volume. Despite having a free trade agreement with Indonesia, Mozambique continues to import Malaysian CPO/CPL as Malaysian CPO price is more competitive than IPO. Besides fulfilling its domestic requirement part of Mozambique palm oil import is also rerouted to neighbouring countries such as Malawi, Zimbabwe, and Zambia.

Last year Kenya was the biggest importer of MPO from the region with an import volume of 520,758 MT. The trend continues in the first two months of this year with an increase of 148.55% compare to the same period last year. The surge in MPO imports in Kenya is due to increase demand for CPO and CPO import duty is lower than import duty for processed palm oil. Out of 48,571 MT of total MPO import, 98.95% of Kenya’s import is in the form of CPO/CPL.  Kenya also functions as an East African regional palm oil hub to the neighbouring landlocked countries such as Uganda, Rwanda, and Burundi.

Other countries that have shown some improvement in MPO imports are Madagascar and the Congo Democratic Republic with 20.21% and 213.76% increase respectively, mostly in the form of CPL.

The decrease in RBD palm oil imports by the region especially from Tanzania, Togo, Benin, and South Africa can be attributed to higher export prices of RBD palm olein in January and February 2021 compared to last year’s prices. RBD palm olein imports have reduced by 52.44% to 58,245 MT from 122,479 MT registered during Jan-Feb 2020. The biggest drop in RBD palm olein import is registered by Tanzania which its RBD palm olein import has reduced from 27,616 MT in Jan-Feb 2020 to 17,168 MT in Jan-Feb 2021.

In the next few months, countries like South Africa, Nigeria, Tanzania, Benin, and Togo are expected to import more MPO as their current stocks will be depleted and the region’s economic activities will slowly return to normal with Covid-19 cases dropping significantly and the vaccination process taking place. However high CPO price could be a major deterrent that could affect the volume of MPO shipment to the SSA region.

Figure 2: Breakdown of MPO Exports (%) Jan-Feb 2021

Source : MPOB

Crude palm oil/olein and RBD palm olein are 2 majors MPO palm oil products exported into the region with each product made up of about 64.27 % and 20.34% respectively. CPO/CPL imports have increased by almost 30.03% to reach 184,004 MT compared to 141,507 MT during the same period last year. Among major importers of Malaysian CPO/CPL are Kenya (47,577 MT), Mozambique (47,044 MT), Ghana (26,998 MT), and Nigeria (19,478 MT).  On the other hand, RBD palm olein imports have reduced by 52.44% to 58,245 MT from 122,479 MT registered during Jan-Feb 2020. Major importers of RBD palm olein from the region include Tanzania (17,168 MT), Angola (10,815 MT), and Togo (10,198 MT).

Table 2:  Breakdown of MPO Exports Products to Sub-Saharan Africa (MT)

Diff (MT)Diff (%)Jan-Dec 2020
RBD PL58,245122,479(64,234)(52.44)866,335
RBD PO2173,709(3,492)(94.15)65,629
RBD PS15,44213,6771,76512.9064,005
Cooking Oil14,90317,334(2,431)(14.02)138,862

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