Malaysian Palm Oil Exports Performance to Asia Pacific Region
(Jan – Aug 2021)
A Review on MPO Performance
|No||Country||Jan – Aug 2021||Jan – Aug 2020||Diff (MT)||Diff (%)|
|9||Papua N Guinea||12,532||4,894||7,638||156.07|
From January to August 2021, Malaysian palm oil export to the Asia Pacific region decreased by 446,903 MT or by 23.1% compared to the last year. The decline in exports were mainly due to lower demand of Malaysian palm oil from Singapore, Philippines, Vietnam and Korea as these countries recorded a drop in Malaysian palm oil imports for the period under review. Among the reasons for the drop is the revision in Indonesian export taxes and levies which has increased the competitiveness of Indonesian processed palm oil. Philippines retained its position as the main destination for Malaysian palm oil exports in the ASEAN region despite of the 13.43% decline in the imports as Indonesian palm oil started to make inroads in the Philippines which increased by 43.4% or 98,000 MT to 324,000 MT for the period January to July 2021 compared to the same period in 2020.
Singapore imports of Malaysian palm oil recorded a decline of 120,859 MT or 50.8% to 117,118 MT from January to August 2021 compared to the same period of last year. In early 2020, Singapore imported a large quantity of CPO for their biodiesel blending, taking advantage of Malaysia’s duty exemption on CPO. From January to August 2020, Singapore imported 59,713 MT of CPO, however, this year, there was no CPO imported due to the high palm oil price and the reinstatement of CPO export duties also impacted imports. The decrease in Malaysian CPO imports in Singapore accounted for 49% of the overall decrease in Malaysian palm oil imports in the country.
Malaysian palm oil exports to Vietnam registered a decline of 119,958 MT or 37.39% to 200,878 MT compared to the same period in 2020, mainly due to an increase in palm oil import from Indonesia and higher crushing of soybeans. Indonesian palm oil import into Vietnam increased by 96,000 MT or 39.18% to 341,000 MT compared to the same period of 2020 due to the competitive price offered by Indonesian suppliers. 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. This is also reflected in the higher import of soybeans from the USA during this review period and it is anticipated that in 2022, 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. In addition, the COVID-19 in Vietnam saw restrictions in business operations and there were widespread closures of restaurants, hotels and canteens resulting in reduced palm oil demand and consumption in the country. This has resulted in a shift in demand for in-home cooking which prefers soybean oil and rice bran oil.
South Korea recorded a drop in Malaysian palm oil imports of 77,992 MT or 25.56%. As reported by USDA, the low palm oil imports in South Korea were due to lower demand from the biodiesel production sector in the country. The biodiesel sector has been the main driver of rising palm oil imports in the country since 2007/08 and over the years, palm oil used in biodiesel has increased due to palm oil’s narrowing 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 decline in imports of Malaysian palm oil by Japan was mainly due to lower imports of RBD palm stearin import which Japan mainly uses as feedstock for FIT-supported powerplants. The utilization of RBD palm stearin is dependent on global palm stearin’s prices and this is reflected in lower consumption due to the high price of RBD palm stearin especially during the first half of 2021. As a result, the import of RBD palm stearin from Malaysia dropped by 29,029 MT or 79.5% to only 7,491 MT compared to 36,520 MT in the same period in 2020. Furthermore, Japan has not been spared from the Covid-19 pandemic and the country extended the state of emergency until 30 September 2021 due to the third wave of COVID-19 infections in the country. The Japanese government program to support domestic tourism has also been suspended, which negatively impacts HORECA sector sales.
Breakdown of MPO Exports to the Asia Pacific Region (MT) January to August 2021
|Malaysian Palm Products Export to Asia Pacific Region (By-Products)|
|PRODUCT||Jan-Aug 2021||Jan-Aug 2020||Diff (MT)||Diff (%)|
|RBD Palm Olein*||869,067||1,019,698||(150,632)||(14.77)|
|RBD Palm Oil*||280,573||380,765||(100,192)||(26.31)|
|RBD Palm Stearin*||106,924||130,104||(23,180)||(17.82)|
|Cooking Oil / DPL||81,863||87,479||(5,616)||(6.42)|
|*Including ISCC, RSPO Mass Balance and RSPO from Segregated Categories|
*Including ISCC, RSPO Mass Balance and RSPO from Segregated Categories
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