Southeast Asian palm oil prices should “remain firm” despite the seasonal output upswing underway in Southeast Asia, Malaysia-listed producer IOI said Monday, thanks to the size of the stockdraws which have been made since producers started to feel the full effects of El Nino.
Total Malaysian palm oil stocks fell 7.6% MoM in January to 1.54mn t. While the stock drawdown underperformed many market participants’ expectations, it still leaves inventory levels over 700,000t lower than this time last year (see PRIMA Weekly Vegetable Oils Report 10 February 2017).
IOI said it is “well on the way” to rebuliding its sustainability credentials after suffering a costly four month suspension from the Roundtable on Sustainabile Palm Oil last year. In a letter to IOI dated 14 March 2016, RSPO claimed IOI had violated RSPO principles and criteria, and set out conditions the company needed to meet to get the suspension lifted. IOI finally lost its RSPO certification in April 2016.
IOI operates 90 palm oil estates, with 89% of its holdings in Malaysia and the rest in Indonesia. The firm’s 15 oil palm millls are all situated in Malaysia, and can process up to 4.6mn t of fresh fruit bunches into palm oil and other products. The firm’s three palm oil refineries in Malaysia and one in the Netherlands can process 3.3mn t of palm oil, producing palm and kernel oil fractions for export as well as feedstock for its own downstream manufacturing. As of last year IOI’s Netherlands and Sandakan refineries were ISCC certified.
MS – 20/02/2017