Palm Oil Demands Could be Better Still

Palm Oil Demands Could be Better Still

InfoSAWIT, KUALA LUMPUR – Crude palm oil (CPO) price at Malaysia Exchange kept decreasing up to RM 100/ton. CPO contract for October delivery got cheaper RM 116 to be RM 3,659 per ton, November did decrease RM 132 to be RM 3,724, and December did decrease RM 134 at RM 3,783 per ton.

Indonesia temporarily stops export levy since 15 July 2022 to escalate the exports while Out Fee keeps remaining and would be adjusted every twice a month based on CPO reference price.

Derivative trade analyst of IcebergX Sdn Bhd, David Ng told, the expensive levy and refence price eventually managed CPO price less competitive than its competitors.

But, David Ng continued, the demands would remain better because in the end, the stocks from Indonesia would be les. This possibly diverts some CPO demands to Malaysia. “But eventually the government would gather or get more expensive tax by maintaining export reference price,” he said, as InfoSAWIT quoted from The Edge Malaysia.

CPO production in Malaysia increased 9,7% in August compared to the previous month while the exports decreased 1,9%. This managed the increasing supply to be 2,09 million tons.

"CPO stock in Malaysia would remain high until Indonesia stops its levy in October 2022. This means, the exports from Malaysia could be increasing till the late of this year,” David Ng said. (T2)