Malaysian palm oil supplies reach new record levels
May 16, 2019
Malaysian palm oil production rose 10% to just under 5M tonnes in the first three months of 2019, compared to last year, reaching a record 3.05M tonnes in February, Germany’s oil and protein plants association, UFOP reported on 30 April.
In contrast, exports from January-March 2019 only rose 7% to total 4.6M tonnes, UFOP said.
“We expect that pressure on palm oil prices is going to increase in the wake of this growth in supplies and consequently, pressure to use more palm oil-based biodiesel in blends will also increase as crude oil prices are on a rising trend,” UFOP said, adding that the Malaysian government had raised its blending mandate from 7% in 2018 to 10% in 2019.
India and China remained the traditional main buyers of palm oil in the first quarter of 2019, followed by the Netherlands and Pakistan.
UFOP figures showed that India purchased around 1.1M tonnes, almost 30% more year-on-year (y-o-y) and twice the amount exported to China, which ordered 571,253 tonnes, translating to a 50% rise from the same period last year.
The Netherlands imported 230,697 tonnes of palm oil, down 16% y-o-y. UFOP said “This may be due to the fact that other EU countries increased their direct shipments. For instance, Spain received 171,161 tonnes from Malaysia. This was a more than 50% increase. Italy even doubled its imports to 124,612 tonnes.”
Germany however, did not play a significant role in foreign trade with Malaysia, with deliveries reaching around 3,642 tonnes in the first quarter of 2019, which was only a fourth of the previous year’s amount, UFOP wrote.