India’s crude edible oil tax cut poses challenge for Malaysian planters with refining ops in Indonesia — CIMB Securities

oil (CPO) and refined palm oil, which had previously favoured crude imports. “On the downside, the wider duty differential poses a challenge to Malaysian and Indonesian palm oil refiners, as it erodes their competitiveness versus Indian refiners. This may also intensify competition for feedstock (CPO). “Additionally, Indian oilseed farmers could be negatively affected, as increased imports may put downward pressure on local edible oil and oilseed prices,” said the research firm. This policy change in India might prompt a shift in demand towards refined palm oil imports, potentially reducing India’s intake of CPO and hindering Indonesia’s refining industry. According to CIMB Securities, among Malaysian planters under its coverage, Kuala Lumpur Kepong Bhd (KL:KLK) and SD Guthrie Bhd(KL:SDG) have exposure to palm oil refining operations in Indonesia. While the move could benefit Indian consumers through lower edible oil prices, it creates a less favourable environment for Indonesian ...