Asia Pacific (Jan – May) 2020

Malaysian Palm Oil Exports Performance to Asia Pacific Region
(Jan – May 2020)
A Review on MPO Performance

NOCOUNTRYJan-May 2020Jan-May 2019Diff (MT)Diff (%)
4South Korea172,157178,967(6,810)(3.81)
10New Zealand9,7066,0013,70561.74
12Papua N. Guinea2,9683,281(314)(9.56)
17Solomon Island64481633.22
22Marshall Island17017#N/A
23New Caledonia1632(16)(50.00)

For the January to May 2020 period, Malaysian palm oil exports to the Asia Pacific region decreased by 98,387 MT or by 7.45% compared to the last year. This was mainly due to the lower imports by Vietnam, Indonesia and Myanmar.

Philippines retained its position as the main destination of Malaysian palm oil exports which recorded the highest increase by 23,001 MT or by 8.5%. The main reason for the increase in palm oil demand is the widening price spread between palm oil and coconut oil which makes it more attractive for domestic consumption of palm oil especially for food applications. For the month of May, the price spread of coconut oil and palm oil was USD300 compared to US177 in January 2020 which is an increase of USD123 or by 69.78%.

Malaysian palm oil exports to Vietnam declined by 30,662 MT or 12.86% compared to same period in 2019 mainly due to competition from Indonesia and high imports of soybean from the USA. It was reported that from January to April 2020, Indonesian palm oil import by Vietnam increased by 18,000 MT or 16.82% compared to same period in 2019 due to the competitive price offered by Indonesia. Vietnam is currently recovering from the 2019 African Swine Fever (ASF) outbreak and as a result, it is anticipated there will be an increase in soybean domestic crushing activities. For this year, it is estimated the soybean import will increase to cater to the demand for domestic feed requirements which will also increase the availability of soybean oil in the market for consumption. This will translate into slow palm oil imports in Vietnam. Based on the Oil World data, USA soybean import in Vietnam recorded a tremendous increased by 143,000 MT or 100.56% to 285,200 MT for the period January to April in 2020 compared to the same period in 2019.

Myanmar, despite being a major palm oil consumer in the region continuously showed a drop in Malaysian palm oil import due to strong competition from the Indonesian palm oil. Myanmar has a bright potential for palm oil but because the country is a price sensitive market, Indonesia dominated the palm oil import by 90% of market share as they offer lower prices for their products. Malaysian palm oil export to Japan, South Korea and Taiwan also recorded a decline mainly due to the demand disruption because of COVID-19 pandemic outbreak.

Breakdown of MPO Exports to the Asia Pacific Region (MT) Jan – May 2020

Malaysian Palm Products Export to Asia Pacific Region  (By Products)
ProductJan-May 2020Jan-May 2019Diff (Vol)Diff (%)
RBD Palm Olein623,799663,947(40,148)(6.05)
RBD Palm Oil216,948193,16123,78712.31
RBD Palm Stearin81,288149,851(68,563)(45.75)
Palm Fatty Acid Distillate73,89086,158(12,269)(14.24)
Palm Acid Oil40,04031,5198,52127.03
Cooking Oil37,95246,607(8,654)(18.57)

Source: MPOB, Oil World & USDA

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