While Malaysia, the world’s second largest producer of crude palm oil (CPO), is seeking to export more palm oil to China following Prime Minister Najib Razak’s visits to China, it may be a tall order this year, as soybean supplies remain ample and Indonesia, another major CPO producer, still has its competitive advantage over Malaysia. “China’s demand for palm oil depends on how competitiveness is CPO price against soybean oil, the availability of domestic edible oils in China as well as the release of rapeseed oils reserves by the government,” Ivy Ng, the regional head of agribusiness of CIMB Investment Bank, told Xinhua…Full Article: ECNS.cn June 2017
- From January to May 2017, Indonesia exported 1.3 million MTs of palm oil to China, while Malaysia exported 650,000 MTs.
- In 2016, Indonesia exported 2.6 million MTs of palm oil to China, while Malaysia exported 1.8 million MTs. Over the past 10 years, China’s demand for palm oil has hovered around 5 million MTs to 6.6 million MTs.
- According to the Singapore-listed financial services company, UOB-Kay Hian, more than 80% of China’s soybean imports are processed and crushed into soymeal. The soymeal is used as animal feed for hogs and poultry.
- By 2020, according to the RSPO, China’s palm oil demand will reach 12 million MTs.
- Palm oil is used in food, cosmetics and biofuels. Within Malaysia, Sabah State (northeastern Borneo Island) is the largest producing region.
- From January to August 2016 (first 8 months), Chinese imports of Malaysian palm oil totaled RB 3.13 billion (~USD 762 million).
- In July 2016, the CEO of McDonald’s China stated that the company plans to replace its palm oil usage with a mixture of sunflower seed and canola oil in 2017.
- From 2011 to 2015, Chinese (incl. Hong Kong and Macau) imports of palm oil were stable, fluctuating only slightly around 5.9 million MTs. Nearly all imports was refined palm oil as opposed to crude/unrefined palm oil. Indonesia and Malaysia were the dominant suppliers, with Indonesia surpassing Malaysia as China’s top supplier in 2015. In 2015, China imported 3.4 million MTs of palm oil from Indonesia and 2.4 million MTs from Malaysia.
- In October 2014, Malaysia reported a drop in palm oil production.
- Founded in 2004 and headquartered in Kuala Lumpur, Malaysia, Roundtable Sustainable Palm Oil (RSPO) is a palm oil trade association that issues certificates to suppliers who follow a sustainable (environmentally friendly) approach to production. In 2013, the RSPO held its first certification seminar in China.
- Founded in 1993 and headquartered in Tianjin, Tianjin Julong Group is a major Chinese palm oil producer and distributor. In 2006, Tianjin Julong Group began operating a palm oil plantation in Kalimantan, Indonesia. The bulk of the companies processing and distribution occurs in the Tianjin Port Free Trade Zone.
Hong Kong Trends