Malaysia: Rising palm oil imports, recovering Indonesian output, sharp drop in exports may signal demand rationing

Published 2024년 12월 10일

Tridge summary

Palm oil imports are expected to rise due to recovering Indonesian output and a decrease in exports, potentially leading to demand rationing, according to Glenauk Economics. This is due to buyers shifting to alternative oils as palm oil becomes less affordable in key markets. High prices, however, are also inspiring new supplies, with the US exporting large volumes of soybean oil. The financial impact of the 45Z tax credit on domestic US buyers is also a factor. In Indonesia, the market is awaiting the B40 allocation, likely to be between 13.5 to 13.9 million tonnes. The Malaysian Palm Oil Board reported a decrease in production due to dryness in Q1 2024 and high rainfall.

Disclaimer:The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

KUALA LUMPUR (Dec 10): Rising palm oil imports, combined with recovering Indonesian output and a sharp drop in exports, may signal demand rationing, according to agricultural commodity advisory firm Glenauk Economics. Glenauk Economics said in its note that December imports are expected to increase, a contrast to the 44.4% decline recorded in November, as Indonesian output recovers and export taxes rise. According to the firm, buyers are taking time to transition to alternative oils, but palm oil is pricing itself out of key importing markets where cooking oil producers have increased their imports of soft oils. A similar trend can also be seen in Malaysia. At the same time, high prices are also driving new supplies, said Glenauk Economics. It said the US is exporting large volumes of soybean oil, including to India, following a strong soybean harvest. In its report, Glenauk Economics also said US domestic buyers remain concerned about the 45Z tax credit, which incentivises the ...

Source: Theedgemarkets