MARKET DEVELOPMENT
Top buyer India to favour Malaysian palm oil
Top buyer India to favour Malaysian palm oil
03.12.2021 (www.thestar.com.my) - JAKARTA: India is likely to buy more Malaysian palm oil after export levies imposed by top producer Indonesia hit record highs in the past year, B V Mehta, executive director of India’s Solvent Extractors’ Association, said yesterday.
Indonesia had imposed higher export taxes and levies in the past year, making prices of palm oil – which had already reached record highs this year – more costly for the top buyer.
“Indonesia’s share of palm oil imports by India earlier was nearly 70% to 75%,” Mehta told the annual Indonesian Palm Oil Conference.
“Heavy export duty and levies being imposed by Indonesia (are) discouraging Indian refiners to buy from Indonesia,” he said.
He added that in January-September this year, Indonesia’s share of Indian palm oil imports had dropped to 55%, while Malaysia’s had jumped 45%.
Indonesia started taxing crude palm oil (CPO) exports again after three years absence in February last year, while export levies for the edible oil reached a record high of US$255 (RM1,079) per tonne in February earlier this year.
In an effort to cool near-record price rises, India cut base import taxes on palm oil, soyoil and sunflower oil in September.
Indonesia has set its CPO export reference price higher for December, meaning that palm oil taxes and levies remain at the top bracket of US$200 (RM846) per tonne and US$175 (RM740) per tonne, respectively.
Indonesia, however, is likely to remain a top supplier of palm oil to Pakistan, another major buyer, Abdul Rasheed Janmohammed, the chairman of the Pakistan Edible Oil Refiners Association, told the conference.
“I personally think Indonesia will have far better prices as compared to Malaysia and the quantity will be also high,” Janmohammed said.
He also noted that Indian buyers were more dependent on CPO imports, while Pakistan imports more refined products with cheaper export duties. ― Reuters