MARKET DEVELOPMENT
Pakistan's Palm Oil Imports Seen up in 2015 - Industry
Pakistan's Palm Oil Imports Seen up in 2015 - Industry
* Palm imports seen up 5-7 percent in 2015 on food demand
* But demand will hinge on palm's discount to other oils
08/12/2014 (Reuters) - Pakistan is likely to import more palm oil in 2015 as growing demand from its food industry and lower prices of the edible oil boost overseas purchases, traders and analysts said on Friday.
Robust demand from a key palm oil importer would support benchmark prices that have tumbled 19 percent this year on rising supply of rival oilseeds, weak uptake in the biofuel sector and a rout in crude oil prices.
"The main driving factor for Pakistan to import more palm oil is the food demand," said Ahsan Mehmood, a senior manager at the commodity trading arm of Pakistan's food-to-energy conglomerate Engro Corp.
"If ghee producers believe they can make more margins with lower raw material prices, it might prompt them to buy more (palm oil)," Mehmood said. Ghee refers to clarified butter that is made from milk or vegetable oils.
He expects Pakistan's palm oil imports next year to rise 5 percent to 7 percent from 2014 levels.
Pakistan shipped in 2.38 million tonnes of edible oils and fats in the first 11 months of 2014, data from the Malaysian Palm Oil Council (MPOC) centre in Lahore showed. Of the total, 95 percent was palm oil - around 70 percent of which came from top grower Indonesia and the rest from No.2 producer Malaysia.
The world's sixth most populous country uses most of the imported palm in its food sector as cooking oil and to produce ghee, while smaller amounts are absorbed into non-food sectors such as soap manufacturing.
Pakistan's imports of refined, bleached and deodorized palm oil - which is hydrogenated to make ghee - has jumped 30 percent so far in 2014 versus the same period in 2013, the MPOC said.
"We expect an increase (in imports) as domestic vegetable oil demand is rising and the dependence on palm oil in Pakistan is high," Siegfried Falk, co-editor of Hamburg-based newsletter Oil World said in an email to Reuters.
But demand will hinge on palm's discount to other oils and imports could be capped if Pakistan imports and crushes larger volumes of rapeseed in the 2014/2015 oil year, Falk added.
Palm olein's discount to soyoil has narrowed to around $110 per tonne from near $130 at end-August, but is wider than $50 at the start of 2014.
* But demand will hinge on palm's discount to other oils
08/12/2014 (Reuters) - Pakistan is likely to import more palm oil in 2015 as growing demand from its food industry and lower prices of the edible oil boost overseas purchases, traders and analysts said on Friday.
Robust demand from a key palm oil importer would support benchmark prices that have tumbled 19 percent this year on rising supply of rival oilseeds, weak uptake in the biofuel sector and a rout in crude oil prices.
"The main driving factor for Pakistan to import more palm oil is the food demand," said Ahsan Mehmood, a senior manager at the commodity trading arm of Pakistan's food-to-energy conglomerate Engro Corp.
"If ghee producers believe they can make more margins with lower raw material prices, it might prompt them to buy more (palm oil)," Mehmood said. Ghee refers to clarified butter that is made from milk or vegetable oils.
He expects Pakistan's palm oil imports next year to rise 5 percent to 7 percent from 2014 levels.
Pakistan shipped in 2.38 million tonnes of edible oils and fats in the first 11 months of 2014, data from the Malaysian Palm Oil Council (MPOC) centre in Lahore showed. Of the total, 95 percent was palm oil - around 70 percent of which came from top grower Indonesia and the rest from No.2 producer Malaysia.
The world's sixth most populous country uses most of the imported palm in its food sector as cooking oil and to produce ghee, while smaller amounts are absorbed into non-food sectors such as soap manufacturing.
Pakistan's imports of refined, bleached and deodorized palm oil - which is hydrogenated to make ghee - has jumped 30 percent so far in 2014 versus the same period in 2013, the MPOC said.
"We expect an increase (in imports) as domestic vegetable oil demand is rising and the dependence on palm oil in Pakistan is high," Siegfried Falk, co-editor of Hamburg-based newsletter Oil World said in an email to Reuters.
But demand will hinge on palm's discount to other oils and imports could be capped if Pakistan imports and crushes larger volumes of rapeseed in the 2014/2015 oil year, Falk added.
Palm olein's discount to soyoil has narrowed to around $110 per tonne from near $130 at end-August, but is wider than $50 at the start of 2014.