Africa (Jan – July) 2021

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

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

CountryJan – Jul
Jan – Jul 2020Difference
Jan-Dec 2020
South Africa82,241128,281(46,040)(35.89)212,509
Congo, Dem. Rep. Of The17,42424,340(6,916)(28.41)47,035
Cote D’Ivoire7,49130,848(23,357)(75.72)53,799
Total1,234,426 1,403,259 (168,833) (12.03) 2,702,381

Source : MPOB

After a lacklustre Malaysian palm oil imports by SSA countries in the first five months of 2021, the past two months have given some indication that MPO imports by the region are going to be much better in the remaining months of this year. From Jan-July 2021, exports of palm oil from Malaysia to the countries in Sub-Saharan Africa have reached 1.234 million MT, which is 12.03% lower than last years’ volume of 1.403 million MT. In addition to the lackluster economic activities, the increase in palm oil prices and high inflation rates are major factors that contribute to the lower imports of Malaysian palm oil. Competition from other palm oil exporting countries and an increase in the local production of palm oil also contribute to the lowering imports of MPO by the SSA region.

On a brighter note, the exports of Malaysian CPO/CPL into the region so far are still higher than last year’s imports, considering higher prices.  In terms of product breakdown, CPO/CPL is the only product that registered an increase when compared to last years’ exports. CPO/CPL exports increased by 20.60 % from 673,305 MT to 812,003 MT during that period. Despite the rise in CPO prices in the international market since the beginning of the year, 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 against other vegetable oils. RBD palm olein exports, on the other hand, suffered the most descend by 53.82% to drop to 240,318MT from 520,448 MT registered in Jan-Jul 2020.

On monthly imports, July 2021 registered the highest imports volume by the region so far this year with 251,499 MT, 5.3% higher than June’s volume of 238,905 MT. If the import pattern follows last year’s trend as depicted in Figure 1 below, imports of MPO will resume their upward movement in the coming months. However high CPO price and the economic impact of Covid-19 shock SSA could be major deterrents that would affect the volume of MPO shipment to the region.

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

Kenya was the biggest importer of MPO from the region with an import volume of 323,295 MT, up by 95.98% from 164,962 MT imported a year earlier. The strong surge in MPO imports in Kenya can be attributed to an increase in demand for CPO by the local refineries in Kenya and neighbouring Tanzania and other land-locked countries such as Uganda, Rwanda, Burundi, and the Democratic Republic of Congo.

Mozambique is the second top importer of MPO from the region and the only other country from the region, other than Kenya that registered an increase in MPO import compared to the same period last year. Most of Mozambique’s import is in the form of CPO/CPL with 120,399 MT out of 158,092 MT of total import volume. In addition to fulfilling its domestic requirement, part of Mozambique’s palm oil import is also rechannelled to the neighbouring countries such as Malawi, Zimbabwe, and Zambia.

The decrease in RBD palm oil imports by the region especially from Benin, Niger, South Africa, and Togo can be attributed mainly to higher export prices of RBD palm olein in the first seven months of this year compared to the last year’s prices. The current pandemic situation has made the cost of freight even higher, therefore increase the cost of imports.

For countries that rely on cross-frontier trade, such as Togo and Benin, land border closure has a deep impact on their economy, hence lower imports of Malaysian palm oil so far this year. Malaysian palm oil imports by Togo and Benin have dropped by 44.38 % and 65.9% respectively.  As the country’s borders remain closed, business and exports are blocked between several of their neighbours in the region, such as states like Nigeria, Ghana, Burkina Faso, Mali, and Niger.

Figure 2: Breakdown of MPO Exports (%) to SSA, Jan-Jun 2021

Source : MPOB

Crude palm oil/olein and RBD palm olein are the top two MPO products exported into the region with each product made up of about 65.78 % and 19.47% respectively. The top four buyers of Malaysian CPO/CPL are Kenya (293,295 MT), Nigeria (163,264 MT), Mozambique (120,399 MT), and Ghana (101,411 MT). On the contrary, RBD palm olein exports have reduced by 53.82% to just 240,318 MT from 520,448 MT registered during Jan-Jul 2020 due to higher prices of RBD palm olein this year. Major importers of RBD palm olein from the region include Tanzania (60,738 MT), South Africa (34,514 MT) and Angola (31,821 MT).

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

Diff (MT)Diff (%)Jan-Dec 2020
RBD PL 240,318520,448(280,130)(53.82)866,335
RBD PO 22,52242,653(20,131)(47.20)65,629
RBD PS29,45137,785(8,334)(22.06)64,005
Cooking Oil81,42481,0293950.49138,862

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