Malaysian palm exports have hit 1,275,869mt so far this month, up 10.75% MoM according to latest Intertek data. Exports to China dropped 33% MoM, amid continued uncertainty over the solidity of the Chinese economy.
India was once again the main destination for Malaysian palm oil exports, with shipments up 23% MoM to sit at 373,500mt so far for August. Exports to Europe have jumped 16% in August to date. Market participants report continued Italian demand for palm oil for use in the power generating sector, with widening price spreads between palm oil and European rapeseed oil also making palm an increasingly attractive feedstock for biodiesel manufacture. Exports to Asia Oceania have also jumped, hitting 221,925mt so far this month, up 25% MoM. The Middle East saw a rise in imports of 60,000mt over the last 5 days, but have still dropped 3% MoM.
Indonesia’s imposition of levies on CPO and processed palm products to fund growth in domestic biodiesel demand will be helping Malaysian sellers to grab market share from their main regional rivals. But increased sales offer only limited solace in the face of the accelerating selloff in the palm oil market. Front month palm futures prices have lost nearly a third of their value so far in the second half after averaging $600/t in the first half of this year. Malaysian conglomerate Boustead yesterday reported a second quarter increase in its fresh fruit bunch production of 27%, a gain which would have been completely wiped out by slumping palm prices if carried undiluted into the third quarter.