Lockdown drops palm oil’s demand: MPOC

Kuala Lumpur/ New Delhi Malaysian Palm Oil Council (MPOC) has said that the prices of palm oil as well as all edible oil have dropped during the pandemic novel coronavirus induced lockdown.

However, Malaysia eyes 1.96 million tonnes production in 2020.

In a webinar organized by MPOC, Dr Kalyan Sudanram of the organization said that Covid-19 has disrupted the economic, social and financial structure of the world.

All major commodities and exchanges have recorded a fall in commodity prices. All major edible oil prices have fallen. The decline of Brent crude oil has also been a factor. Demand for oil and fat in HORECA and bio-diesel has decreased.

He did a comparative analysis of the prices of edible oils during the current year from January to May, saying that there was a sharp decline in exports to India in the current year.

He said that the total production of palm oil is estimated to rise from 1.95 to 16.9 million tonnes in 2020.

Malaysian palm oil exports were estimated at 4.56 million tonnes in the third quarter, which is 2.5 per cent higher than in the second quarter due to a steady increase in demand from traditional markets. Malaysia will export more oil to India, China and European countries which, after the export duty exemption, could be the largest buyer in the third quarter.

Sudhakar Desai of the Indian Vegetable Oil Products Association (IVPA) said that HORECA demand is 30 to 35 per cent of the total consumption of 23 million tonnes of edible oil. Demand for Indian palm oil has been affected up to 40 per cent during the lockdown.

He said that by amending the Essential Commodities Act, now allowing farmers to sell produce outside the market is a major step. Removing oil seeds from this law is also a major change. The priority of the Government of India is now the need to reduce import dependence in vegetable oil, Mr Desai added.

(Agencies)