China is likely to import a record 6.7M tonnes of palm oil this year from October as rising rival soyabean oil prices surge, Bloomberg reports.
Demand for soyabean meal, used for animal feed, had fallen due to African swine fever and China’s trade war with the USA, which meant fewer soyabeans were crushed and less oil produced, Bloomberg wrote on 23 August.
The spread between prices of soyabean oil and palm oil had soared, with soya oil prices hovered near their highest in two years.
“The large spread will continue to spur more palm oil imports,” said Tommy Xiao, an analyst with Shanghai JC Intelligence.
This year’s imports were estimated at 6.5M tonnes, already up from 5.3M tonnes a year earlier, Bloomberg said.
Xiao said edible oil imports may have rose risen 15% in July from June, and shipments were likely to remain steady at about 600,000 tonnes/month for a while.
Indonesia, the world’s largest palm oil producer, saw June Chinese exports jump more than 30% from a year earlier to 435,540 tonnes.
Number two global producer, Malaysia exported 265,045 tonnes of palm oil to China between 1 and 25 August, a 177% surge from a month earlier, according to cargo surveyor Intertek Testing Services.
China’s palm oil consumption rose more than 20% in the first seven months of 2019 due to its price advantage, according to the China National Grains and Oils Information Centre.
Meanwhile, its soyabean imports had fallen 11% in the first seven months of this year compared to last, Bloomberg said.