CPO Price Decreased Almost 6% in a Week

CPO Price Decreased Almost 6% in a Week

InfoSAWIT, KUALA LUMPUR – Crude palm oil (CPO) lost its potential to be more expensive after the Government of Indonesia revoked CPO and its derivative and palm cooking oil export ban. This would be potentially to decreasing because the supply increased when the demands were decreasing.

CPO at Bursa Malaysia Derivative Exchange decreased almost 6% in this week when speculation of CPO export ban still happened in Indonesia. but the facts showed, the Government of Indonesia re-opened CPO export that President Joko Widodo announced on Thursday (19/5/2022) and would be effective on Monday (23/5/2022).

As quoted from Bloomberg, CPO export ban was running on 28 April 2022. This became the protectionism of the biggest commodity since Russia invaded Ukraine which postponed sunflower oil (to many countries) and vegetable oil stocks got worse in the globe. CPO is used in many products – from food, soap, and fuel. What the Government of Indonesia did increase its price much more expensive though the CPO consumers decreased their demands.

Manager of Wheat and Oil Trade at Savola Foods, Tajgir Rahman said, CPO could be RM 5000 (US$ 1.135) per ton in July or August 2022 because of the abundant stocks in the markets.

Cargo surveyor mentioned, CPO exports from Malaysia to India and China start decreasing in the first two weeks in May 2022 when other countries got increasing import. This happened for the expensive price and the two countries should postpone their imports. In addition, China is in bad situation for the lockdown to stop Covid-19 spread.

Analyst of RHB Research, Hoe Lee Leng said, there would be much change in policies, bulk palm cooking oil price that could be increasing, the companies to supply domestic needs. “Export citation which could be more expensive, or obliged scheme to recover domestic needs within different parameter,” he said in an official statement

At Malaysia’s exchange CPO was on the floor at RM 6.007 per ton on Thursday (19/5/2022). Palm oil observer, Dorab Mistry predicted, it could be cheaper to be at RM 5.000 per ton and get more cheaper at RM 4.000 in September 2022 after Indonesia revoked its export ban and when the war is over in Ukraine. (T2)