Malaysian Palm Oil Exports Performance to Asia Pacific Region
(Jan – Feb 2021)
A Review on MPO Performance
|No||Country||Jan-Feb 2021||Jan-Feb 2020||Diff (MT)||Diff (%)|
|10||Papua N. Guinea||3,068||793||2,275||286.92|
During the period of January to February 2021, Malaysian palm oil export to the Asia Pacific region decreased by 129,464 MT or by 27.11% compared to the same period of last year as most of the countries imports of MPO declined. The main reason for this was the revision of Indonesian export taxes and levy which made their price more competitive especially for refined palm oil products. This will likely result in a scenario where there will be higher demand for PPO from Indonesia and major CPO consuming countries will look to Malaysia for supplies. Asia Pacific countries are mostly the PPO importers and this resulted in the increase of Indonesian palm oil intake in this region.
Philippines retained its position as the main destination of Malaysian palm oil in this region despite recording a drop of 41,438 MT or 31.82% to 88,792 MT compared to the same period last year. The reason for the drop is due to a high carry-over stock from 2020 as palm oil import increased by 4.08% to 1.08 million MT while the consumption dropped by 4.7% due to the restrictions caused by rising the COVID-19 cases. This resulted in the high availability of palm oil in the country. However, the three strong typhoons hitting parts of the Philippines in October and November 2020 severely impacted the coconut industry. The most significant effect on coconut oil output is expected from November 2020 to April 2021, but the consequences will be felt throughout the year. To meet the local demand for oils and fats, palm oil imports in the Philippines are projected to increase in 2021.
Singapore recorded a decline of 40,500 MT or 60.05% to 26,942 MT in this review period compared to the same period of last year. In early 2020, Singapore imported a large quantity of CPO for their biodiesel blending as taking advantage of Malaysia’s duty exemption on CPO. From January to February 2020, Singapore imported 16,999 MT of CPO, however, this year, there was no CPO imported due to the high palm oil price.
Malaysian palm oil exports to Vietnam registered a decline of 12,232 MT or 24.73% to 37,222 MT compared to the same period of 2020, mainly due to higher palm oil import from Indonesia and high import of soybeans from the USA. It was reported that in 2020, Indonesian palm oil import in Vietnam increased by 259,000 MT or 75.7% to 601,000 MT compared to 2019 due to the competitive price offered by Indonesian suppliers. In addition, Vietnam is currently recovering from the 2019 African Swine Fever (ASF) outbreak and as a result, it is anticipated that there will be an increase in soybean domestic crushing activities. For 2021, soybean import is likely to increase to cater to the demand for domestic feed requirements which will also increase the availability of soybean oil in the market for local consumption. This will translate into slow palm oil imports in Vietnam. The COVID-19 restriction which caused widespread closures of restaurants, hotels and canteens also reduced palm oil consumption in the country. As a result, there was a shift to more home cooking where consumption of soybean oil and rice bran oil is more popular.
South Korea recorded a drop in Malaysian palm oil imports during the said period about 20,777 MT or 30.39% to 47,580 MT. As reported by USDA, the low palm oil imports in South Korea due to lower demand for biodiesel production. The biodiesel sector has been the main driver of rising palm oil imports in the country since 2007/08. Over the years, palm oil used in biodiesel increase due to the price competitiveness over soybean oil. It is estimated that the palm oil import will slightly increase this year driven by the Korean government’s plans to increase the biodiesel mandate from B3 to B3.5 in July 2021.
The drop in the Malaysian palm oil import in Japan mainly due to the third wave of COVID-19 infections in the country which a 30-day state of emergency was declared on 7 January 2021. The Japanese government program to support domestic tourism has been suspended, which negatively impacts HORECA sector sales. It is reported that restaurant bankruptcies reached a record high in 2020. While Myanmar continuously showed a drop in Malaysian palm oil import due to strong competition from the Indonesian palm oil. Myanmar has good potential for palm oil import but because of the price sensitive nature of the market, Indonesia dominates the market with a 90% share.
Breakdown of MPO Exports to the Asia Pacific Region (MT) January to February 2021
|Malaysian Palm Products Export to Asia Pacific Region (By Products)|
|PRODUCT||Jan-Feb 2021||Jan-Feb 2020||Diff (MT)||Diff (%)|
|RBD Palm Olein*||202,129||241,604||(39,476)||(16.34)|
|RBD Palm Oil*||68,431||74,421||(5,989)||(8.05)|
|RBD Palm Stearin*||26,493||43,604||(17,111)||(39.24)|
|Cooking Oil / DPL||20,292||24,762||(4,470)||(18.05)|
|*Including ISCC, RSPO Mass Balance and RSPO from Segregated Categories|
*Including ISCC, RSPO Mass Balance and RSPO from Segregated Categories
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