Anda di halaman 1dari 12

The average price of crude palm oil in

March settled at RM2,771/MT for the


benchmark contract FCPOc3 on the
Bursa Malaysia Derivatives Exchange,
increased by RM153/MT over the
average price of December last year. It
was as expected that the prices were on
the uptrend but settled slightly lower than
the earlier forecasted price at
RM2,750/MT. This was published in
MPOC FORTUNE (http://www.mpoc.org.
my/Malaysian_Palm_Oil_Fortune.aspx)
volume 12 2013. Decreased stock of
Malaysian palm oil had supported very
much the increase of palm oil prices. The
stock of Malaysian palm oil recorded at
1.93 million MT in January dropped to
1.66 million MT in February, the lowest
stock in three years and slightly
increased in March to 1.69 MT.
A lower production in beginning of the
first half of the year which is a normal
trend for palm oil production in Malaysia
put another pressure to the stock
available in the world market. Production
of Malaysian palm oil for December,
January, February and March were at
1.67, 1.51, 1.28 and 1.50 million MT
respectively. However, collectively these
were 98,000 MT lower than the average
of production in 2013 at 1.60 million MT.
Also observed was a rising trend of
domestic consumption of Malaysian palm
oil for the period of January, February
and March at 208,788, 210,960 and
237,894 MT respectively. These were
much higher compared to the same
period last year which recorded less than
150,000 MT each month in the first
quarter 2013.
Palm oil price was at the peak in early
March 2014 as shown in the Chart 1
above. Tight world supply of palm oil and
the threat of long drought in major palm
oil producing countries had a major
psychologically bullish impact on the
prices. The drought and heat had
prevailed in 6 to 8 weeks in the first half of
the year in many palm oil growing areas
of both biggest producers of palm oil
Malaysia and Indonesia.
The conflict on the Crimea between
Russian and Ukrainian also had some
impact on the supply of rapeseed and
sunflower seeds / oils as farmers reduced
their sales activity in reaction to the
significant currency devaluations in both
Ukraine and Russia and trading houses
MPOC FORTUNE
MALAYSIAN PALM OIL COUNCIL KKDN PP 14669/05/2013 (032704) VOL: 3 2014

DIRECTOR
Faudzy Asrafudeen Sayed Mohamed
faudzy@mpoc.org.my
MANAGERS
Muhammad Kharibi Zainal Ariffin
kharibi@mpoc.org.my
Mohd Izham Hassan
izham@mpoc.org.my
MARKET ANALYSTS
Asia Pacific Lim Teck Chaii
(China) lim@mpoc.org.my
Asia Pacific Mohd Hafezh Bin Abdul Rahman
(Excl. China) mhafezh@mpoc.org.my
South Asia Fatimah Zaharah Md Nan
fatimah@mpoc.org.my
Middle-East Mohamad Suhaili Hambali
msuhaili@mpoc.org.my
Africa Nor Iskahar Nordin
iskahar@mpoc.org.my
Europe Azriyah Azian
azriyah@mpoc.org.my
Americas Mohd Izham Hassan
izham@mpoc.org.my
MARKETING & MARKET
DEVELOPMENT DIVISION
For more information, please contact
Tel : 603 - 7806 4097 Fax: 603 - 7806 2272
Continued on page 7
Chart 1: Daily FCPO price movement 3800
3600
3400
3200
3000
2800
2600
2400
2200
2000
3
/
1
/
2
0
1
2
3
/
2
/
2
0
1
2
3
/
3
/
2
0
1
2
3
/
4
/
2
0
1
2
3
/
5
/
2
0
1
2
3
/
6
/
2
0
1
2
3
/
7
/
2
0
1
2
3
/
8
/
2
0
1
2
3
/
9
/
2
0
1
2
3
/
1
0
/
2
0
1
2
3
/
1
1
/
2
0
1
2
3
/
1
2
/
2
0
1
2
3
/
1
/
2
0
1
3
3
/
2
/
2
0
1
3
3
/
3
/
2
0
1
3
3
/
4
/
2
0
1
3
3
/
5
/
2
0
1
3
3
/
6
/
2
0
1
3
3
/
7
/
2
0
1
3
3
/
8
/
2
0
1
3
3
/
9
/
2
0
1
3
3
/
1
0
/
2
0
1
3
3
/
1
1
/
2
0
1
3
3
/
1
2
/
2
0
1
3
3
/
1
/
2
0
1
4
3
/
2
/
2
0
1
4
3
/
3
/
2
0
1
4
Resistance Level at RM2,901
Support Level at RM2,493
2nd Quarter CPO price
forecast Current drop
in CPO price revived
the Biodiesel sector in
Malaysia and Indonesia
MPOC FORTUNE 3
MARKETInsights Ins g
CHANGE IS the only constant, said
Heraclitus. The evolution of life and
lifestyles can be clearly observed
throughout the history of the world.
Pakistan is no different and the lifestyles
of people of the country have seen major
changes since its inception more than 65
years ago. With increasing globalisation
and the shrinking of the world, the
Pakistani lifestyle has changed rapidly.
The last decade has especially
transformed the Pakistani consumer
lifestyle. This can be attributed to a
number of reasons, including a
movement of the population from rural to
urban areas, increasing industrialisation,
an increase in per capita income and the
rapid increase in technology and
communications, to name a few.
Wide-reaching changes have resulted,
which include variations in family
structures, fashion, recreation and food.
With an increase in disposable income,
there has been a shift in consumer
tastesin traditional eating behaviours.
Now, an increasing number of Pakistani
consumers dine out regularly and want to
eat foods different from the traditional
Pakistani dishes. This changing eating
habit of the Pakistani consumer is evident
as can be clearly seen from the
mushrooming of international food
chains, cafes and international cuisine
restaurants across the country. The
popularity of these restaurant chains is
also due to the fact that many of these
cater to people in the middle and lower
income classes, who make up the
majority of the population.
The fastfood industry in Pakistan, which
commenced in 1997 with launch of
McDonalds, has grown extensively over
the past 17 years. This industry has
registered a growth of 15% in the first 10
years and then continued to grow at an
average rate of 7%.Leading international
food chains suchas McDonalds, Pizza
Hut, Dominos, Hardees, KFC, Nandos,
Papa Johns and Subway are immensely
popular. Despite difficult economic,
security and political conditions, new
international food chains such as Burger
King, Fatburger and Johnny Rockets
have opened outlets in Pakistan which
shows the potential of this market. Newly
established food chains such as
YogenFruz and TuttiFrutti Frozen Yogurt
have also entered the Pakistani snack
and fast food market.
Continued on page 9
45,000
40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
2010 2010 2011 2012 2013
Chart1: Imports Trend of Palm-based Specialty Fats
Source: MPOB Data
Margarine
T
o
n
n
e
s
H Palm Oil Shortening Palm Kernel Oil Cooking Oil
Palm oil in Pakistan
Has very promising
potential for wider use
North Port, Port Klang
- Fima Bulking Services Berhad
- Fimachem Sdn Bhd
- Fima Liquid Bulking Sdn Bhd
- Fima Freight Forwarders Sdn Bhd
Butterworth
- Fima Palmbulk Services Sdn Bhd
Jalan Parang, 2nd Extension, North Port, 42000 Port Klang, Selangor, MALAYSIA
Tel: +603 - 3176 7211 Fax: +603 - 3176 5641 Email: enquiry@fimabulking.com
http://www.fimabulking.com
Located in a free commercial
zone offer excellent
opportunities for
Import and export
Transhipment
MDEX tender (approved
delivery point)
Regional collection /
distribution hub
Facilities available :
Carbonsteel
Coated & stainless tanks come
with heating facilities &
nitrogen blanketing.
Malaysias Largest Independent
Common-user Multi-purpose Liquid
Bulk Terminal Operator
MPOC FORTUNE 5
Continued on page 10
European policies on biofuels and
their implications on palm-oil based
biodiesel
The EUs regulatory framework affecting
biofuels is to be framed within the EUs
strategy to tackle climate change, which
has required, and is leading to, the
adoption of (inter alia) a classification of
biofuels based on their production
methods or carbon footprints. Directive
98/70/EC of the European Parliament
and of the Council of 13 October 1998
relating to the quality of petrol and diesel
fuels and amending Council Directive
93/12/EEC (hereinafter, the Fuel Quality
Directive) provides, in relevant part, a
framework for EU Member States to
reduce by 6% the greenhouse gas
intensity of transportation fuels by 2020.
In addition, Directive 2009/28/EC of the
European Parliament and of the Council
of 23 April 2009 on the promotion of the
use of energy from renewable sources
and amending and subsequently
repealing Directives 2001/77/EC and
2003/30/EC (hereinafter, the Renewable
Energy Directive) establishes a common
framework for the promotion of energy
from renewable sources in the EU by
setting mandatory national overall
targets and measures to promote the use
of energy from renewable sources, in
order to reduce emissions and to achieve
the EUs climate change and energy
policy objectives. In relevant part, the
Renewable Energy Directive establishes
that 10% of the energy used for transport
in the EU should originate from
renewable sources by 2020.
While promoting the use of energy from
renewable sources, such as biofuels, as
a tool to combat climate change, the Fuel
Quality Directive and the Renewable
Energy Directive cater for sustainability
criteria that apply to biofuels, which have
a clear impact on international trade in
such products, including on palm
oil-based biodiesel. The sustainability
criteria are directed at avoiding that an
increase in demand for such energy
sources, as well as the incentives
provided for their use, lead to the
destruction of biodiversity or result in
other counterproductive effects for the
environment. They are based on two
drivers: (i) biofuels must reach a
greenhouse gas emissions saving
threshold of at least 35% with respect to
the greenhouse gas emissions that
would have resulted from using fossil
fuels (as of 2017, this target will increase
to 50% for existing installations and 60%
for new installations); and (ii) the land
used to produce biofuels must have
certain characteristics (i.e., not have high
biodiversity value nor high carbon stock).
Biofuels that do not meet the
sustainability requirements are still
allowed in the EU market, but are not
eligible for achieving compliance with
renewable energy national targets set by
EU legislation and are not entitled to
financial support. This has a clear impact
on the importation in, and marketing
within, the EU of biofuels that are defined
as unsustainable, operating as a barrier
to trade (de facto if not de jure) and
resulting in trade discrimination, in
possible violation of WTO rules.
The actual implementation of the
sustainability criteria may have clear
discriminatory effects, inasmuch as
compliance therewith may, in certain
instances, be particularly burdensome
for certain types of biofuels (i.e., those
MARKETInsights Ins g
European Policies & Legislation
Impacting Food Labelling and Biodiesel:
Current & Post 2014 Part 2 of 2
MPOC FORTUNE 7
reported as being hesitant in concluding
new grain export contracts.
Crude palm oil price at Rotterdam usually
trades at a discount of USD50 to USD100
a tonne to soybean oil, but in the
beginning of the second week of March,
the prices of palm oil started to decline. At
the average price of USD 968 for crude
palm oil, the premium of soybean oil over
crude palm oil in Rotterdam had
narrowed to only USD 41.12 USD and
consumers in Europe started to react. In
Europe, palm oil has lost its
competitiveness in the energy market
outside the mandates, primarily for
electricity production. Food consumers
have partly switched to sun oil and soya
oil. In North Africa, as well as in Turkey
and Russia, sunflower oil had the
greatest price advantage. Indian
importers had considerably increased
purchases of sun oil at the expense of
palm oil.
2nd Quarter 2014 Price Trend
Toward the second quarter of the year,
there will be always a situation in the
market where there will be a severely
depleted soybean supplies for US crops
and ampleness of supply situation for
South America crops. For the US,
beginning of second quarter, USDA
estimates there would a severe
slowdown of US soybean exports and
expected a steep increase of imports in
the next few months for US market.
USDA also lowered the 2013/14 US
soybean ending stocks to a 10-year low
of 135 million bu.
Soybean stocks in South America may
turn out somewhat larger this season and
will then possibly have to compete with a
record US crop if weather cooperates. At
the same time, larger stocks accumulated
in China and other importing countries in
recent months would potentially hinder
high exports from both South America
and US for the period of April-September
2014. These scenarios represent for a
considerable downward potential of
soybean prices toward the end of second
quarter but this could not happen as the
bullish factors of palm oil during this
period would bring soybean and soybean
oil price upward.
In the second quarter of 2014, the price
premium of soybean oil over palm oil is
expected maintain its gap at around USD
40-50 per tonne for Rotterdam price.
Prices of both oils are expected to
increase toward the end of second
quarter mainly supported by the lower
production palm oil toward the end of this
year and increase usage of palm based
biodiesel in Malaysia and Indonesia. The
increase of palm oil price would be
normally followed by the increase of
soybean oil and other vegetable oils in
global market.
The severe dry spell affecting major palm
oil producing areas of Malaysia,
Indonesia and Thailand in February and
March has abated but was still insufficient
to replenish soil moisture to adequate
levels. The palm trees have not yet fully
recovered and still show spears in the
drought-affected regions, a clear sign of
moisture deficits. The impacts from the
dry weather would not likely be seen until
October through December, but could
last as much as two years. With 5%
reduction in production due to this dry
weather could equate to 2.7 million
tonnes in losses which could impact the
market significantly.
The setback of palm oil prices since
March may have largely given way to
1,400.00
1,200.00
1,000.00
800.00
600.00
400.00
200.00
0.00
400.00
350.00
300.00
250.00
200.00
150.00
100.00
0.00
50.00
J
a
n
F
e
b
M
a
r
A
p
r
M
a
y
J
u
n
J
u
l
A
u
g
S
e
p
O
c
t
N
o
v
D
e
c
J
a
n
F
e
b
M
a
r
2013
SBO premium over CPO (right) CPO Rott (Left) SBO Rott (right)
2014
Chart 2: CPO vs SBO at Rotterdam Price (USD)
MARKETInsights Ins g
Continued from page 1
Continued on page 11
2nd Quarter CPO price
forecast Current drop
in CPO price revived
the Biodiesel sector in
Malaysia and Indonesia
MPOC FORTUNE 9
Chart 2: 10 Year Edible Oil Import Analysis
Source: Shipping Agents Vessel Reports
T
o
n
n
e
s
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
2,500,000
2,000,000
1,500,000
1,000,000
500,000
0
The trend of snack foods and fast food is
rapidly increasing and will continue to
grow. The developing fast food and
snack food market means more
opportunity for the usage of palm oil and
its fractions. With palm oil being the
preferred choice in the confectionery,
baking and frying industries, this presents
a promising opportunity for the further
growth of the palm oil market in Pakistan.
Before the advent of the fast food
industry, palm oil was mainly used for
making vanaspati, which is the
predominant cooking medium in
Pakistan. Over the last decade, palm oil
usage in Pakistan has expanded to
various industries and a wide range of
palm oil fractions are being imported in
the country. The fast food and snack food
industries are among the biggest
consumers of palm olein, which is being
used by most of the industry leaders for
frying purposes. This trend is also filtering
down to smaller manufacturers, both in
the organised and unorganised sectors.
Palm olein is imported directly from
Malaysia by some international chains
and at the same time, palm olein-based
specialised frying oil is also being
produced by the local industry. Two
brands of super olein in commercial
packaging arealso available in the
market. Other positive indications are the
installation of fractionation units in the
country and the increasing trend of palm
olein blending in soft oils, especially in
the summer.
The increased usage of palm oil in
commercial frying and various food
applications has also resulted in an
increase in the imports of palm finished
products and specialty fats. The imports
of packed cooking oil, margarine and
palm kernel oil and its fractions are
among the fast growing items that are
becoming an integral part of food
industries in Pakistan.
At the end of 2013, the imports of palm oil
and its fractions registered an increase of
approximately 16% as compared with
imports in 2012 and stood at 2,327,938
metric tonnes (MT). From the 10-year
import analysis, it can be seen that the
imports have been growing steadily at an
average of 5.8%. This consistent
increases in the imports are attributed to
factors such as the increased usage of
palm oil in food applications, growth in
population and stagnant indigenous
oilseed production.
Indigenous oilseed has shown a
declining trend in Pakistan and the gap
between total consumption and
availability has been growing. This gap
has made Pakistan a net importer of oils
and fats and this situation is not likely to
change in the foreseeable future. The
steady increase in the imports of oils and
fats is a clear indication that Pakistan will
continue to remain a lucrative destination
for countriesexporting edible oils.
The evolution of the consumer lifestyle in
Pakistan has resulted in a number of
areas of potential expansion for the palm
oil market. These include the areas of
confectionery, frozen food, ice-cream
and chocolate, soaps and oleochemicals,
paints, pharmaceuticals, dairy and
creamers and animal feed. Palm oil
consumption will increase, in the food
industry especially, and will be an area of
opportunity and focus. While the
traditional ghee and oils remain, the use
of specialised oils and fats will increase
now, where palm oil can play a big role.
With a population of 180 million and a
population growth rate of 2% a year,
Pakistan will always remain a net
importer of oils and fats. Coupled with the
increasing consumer awareness and
exposure to education, the Internet and
social media, the versatility of palm oil
and its uses will continue to come to the
forefront. Pakistan is an agrarian country
where agriculture contributes 21% to the
GDP, employs 45% of the labor force
and, along with raw & processed
agricultural supplies, generates 65% of
the total export earnings. The
International Monetary Fund said that
Pakistan has met nearly all of its
quantitative performance markers, that
its economy is showing signs of
improvement and that its reform program
remains broadly on track.
Palm oil is the most suitable edible oil for
Pakistani manufacturers and consumers
and there is a strong Malaysian
presence, with joint ventures in the
country as well. Additionally, with its
logistic advantage over competition from
soft oils, the multi-purpose palm oil can
continue to make inroads into the
Pakistani market. Faisal Iqbal, MPOC
Pakistan
MARKETInsights Ins g
Continued from page 3
Palm oil in Pakistan
Has very promising potential for wider use
10 MPOC FORTUNE
European Policies &
Legislation Impacting
Food Labelling and
Biodiesel: Current &
Post 2014
attributed default values that are lower
than the 35% required greenhouse gas
saving threshold, like palm oil-based
biodiesel or soybean biodiesel) or for
certain exporters (those that are not
certified under a scheme recognised by
the EU), as shown by the WTO dispute
triggered by Argentina against the EU
before the WTO.
Similar considerations also apply to the
EUs proposed amendment to the Fuel
Quality Directive and the Renewable
Energy Directive (the so-called ILUC
proposal), which is aimed at addressing
the emissions arising from the impact of
indirect land use change (ILUC) on
greenhouse gas emissions (i.e., those
created as a result of increased land
demand for the production of biofuels,
where such land could have been used
for food, feed or fibre production). This
proposed amendment would operate a
further classification of biofuels into first
generation biofuels and advanced
biofuels, with the latter set to receive a
more favourable treatment in the EU
market.
In addition, if approved, it would attribute
distinctive ILUC emission factors to
biofuels, depending on whether they
originate from: (i) food crops, and, in
such latter instance, whether they have
been produced from cereals and other
starch rich crops, sugar crops, or oil
crops. According to the proposed
amendment, these ILUC emission
factors will be relevant for monitoring
purposes only, but will most likely be
factored into the calculation of the overall
environmental impact of biofuels once
the EU framework will be revised (i.e., in
2020). Once more, palm oil-based
biofuel, which is attributed, together with
other vegetable oils, the highest ILUC
emission factor, stands to be particularly
affected by this proposed framework.
See dispute European Union and Certain
Member States Certain Measures on the
Importation and Marketing of Biodiesel and
Measures Supporting the Biodiesel
Industry, WT/DS459.
Within such troubling regulatory context,
EU biofuel producers have also taken
initiatives of their own to drive palm
oil-based (and other) biofuels out of the
EU market. In particular, a number of
trade defence proceedings were
triggered against imports of biofuels from
a number of different countries, such as
the United States, Argentina and
Indonesia. These actions have recently
led (inter alia) to the adoption of
provisional anti-dumping duties on
imports of palm oil-based biodiesel and
soybean biodiesel into the EU, and
pose an additional challenge for the sale
of palm oil products into the EU.
Conclusions
The regulatory and commercial threats
currently faced by palm oil concern both
its food and biofuel applications. With
respect to its food application, the illegal
and deceptive palm oil free campaigns
are being perpetrated in suspicious
synchrony with regulatory changes
taking place in the EU and in other
European countries, which will require
the indication of the vegetable origin of
oils on food products labels. With
respect to the biofuel application of palm
oil, blanket regulation and legislation has
been adopted or is being drafted, based
on environmental objectives. These
legislative initiatives harbour worrying
developments and, in synchrony, there
is a proliferation of private initiatives
intended to keep palm-oil based biofuels
outside of the EU market.
There is a clear link between the
regulatory developments taking place, or
adopted, at the EU and/or EU Member
States level and the actions undertaken
by private operators: if the position of the
regulator is not challenged, it will de facto
result in governmental confirmation that
the allegations being brought by privates
through their deceptive and illegal
campaigns are based on true facts.
This is why the Malaysian Palm Oil
Council has decided to take action and
lodged administrative complaints before
competent the French administration
(both centrally and at regional level), in
relation to the many instances of
misleading claims described above. In
parallel, judicial action before the
competent French Tribunal du
Commerce has been taken against a
well-known French retailer for its
deceptive and illegal nutrition claims.
These actions, if accompanied by
positive decisions of the administrative
and/or judicial authorities, will provide the
substantive bases through which the
infringers can be forced to halt their
misleading and illegal campaigns and to
for palm oil to regain consumers trust.
These challenges need to be coupled to
a set of concerted and syncronised trade
and diplomatic actions, which have to be
taken in parallel as part of an overall
strategy to act against the misleading
allegations being brought against palm
oil. These actions must focus on a
number of bilateral and multilateral
instruments. Bilaterally (i.e., both
vis--vis the EU and individual EU
Member States), the many palm oil
producing countries around the world
should turn the issue from one of mere
technical, consumer protection and
labelling nature to one of trade
relevance.
Provisional anti-dumping duties are set to
expire on 28 November 2013, when definitive
measure will reportedly be imposed.
Bilaterally, the EU is engaging many
such countries in the negotiation of
preferential trade agreements (i.e.,
FTAs, EPAs, CEPAs, etc.). These fora
must also address palm oil, both in terms
of the EU rules on environmental
protection and sustainability (under the
EUs Renewable Energy Directive and
the Fuel Quality Directive) and in light of
the applicable EU and EU Member
States rules on food safety, food quality,
nutrition and health labelling, and on the
prevention of deceptive practices. It is
true that this realm belongs to the private
world and that private standards largely
escape international trade rules at
MARKETInsights Ins g
Continued from page 5
Continued on page 12
MPOC FORTUNE 11
CPO Brent Oil SBO
Chart 3: CPO vs SBO vs Brent Oil Prices
1,600
1,400
1,200
1,000
800
600
400
200
0
U
S
D
/
T
o
n
n
e
J
a
n
M
a
r
M
a
y
J
u
l
S
e
p
N
o
v
J
a
n
M
a
r
M
a
y
J
u
l
S
e
p
N
o
v
J
a
n
M
a
r
M
a
y
J
u
l
S
e
p
N
o
v
J
a
n
M
a
r
M
a
y
J
u
l
S
e
p
N
o
v
J
a
n
M
a
r
M
a
y
J
u
l
S
e
p
N
o
v
J
a
n
M
a
r
2009 2010 2011 2012 2013 2014
a renewed uptrend in the second quarter.
Looking at the Chart 3, the reducing price
of palm oil would narrowing the gap of
price differences between Brent oil / CPO
and recent price weakness revived the
feasibility of the biodiesel programmes in
Indonesia and Malaysia. Both
programmes already had a clear-cut
effect on the world market in recent
months with exports declining and palm
oil stocks in Malaysia remaining fairly low
despite a large production increase in
March.
In March 2014, the B5 admixture
mandate was implemented in Peninsula
Malaysia, whereas in 2013 it had been
implemented only in the central and
southern regions of the Peninsula. The
B5 is a blending of 5 percent palm methyl
ester with 95 percent of fossil diesel, will
be extended nationwide by July this year.
Implementation of the policy is expected
to boost domestic consumption by an
additional 500,000 tonnes annually. It
has been announced that another
increase in mandatory biodiesel
admixture for transport fuel to 7% (B7)
will come into force in early 2015. This
would increase further the usage of palm
methyl ester for biodiesel by another
700,000 tonnes annually. Higher
domestic consumption in major
producing countries because of
government biofuel mandates also
leaves fewer supplies available to export.
Hence, based on the trend, there are
several bullish factors to support palm oil
prices toward the end of second quarter
and the price is expected to increase
which is likely to be more than
RM2,800/MT for the average price in
June. Global palm oil imports will pick up
in the second quarter as demand
increases before Ramadan. There are
also positive signs that CPO prices would
to increase further in third quarter as
demand picks up especially in the festive
months of July during the Eid Fitri
celebrations in July.
Oil World reports that purchases will
climb to about 10.5 million metric tons in
the April-to-June quarter from 9.6 million
tons in the first quarter, with more exports
expected from Indonesia and Malaysia,
said in a report. Importers will need to
replenish stockpiles of vegetable oils
made from soybeans, sunflower and
palm in the next six months, and demand
for cooking oils usually climbs before the
Muslim fasting month of Ramadan, when
communal meals increase.
Other soft oils situation also needs to be
monitored especially on the export of
soybean and soybean oil development in
the market. The drop in Brent oil prices
could also bring the palm oil prices
downward. But this would not be the
scenario as Brent oil prices were
relatively stable for the whole year 2013
and 2014, unless there is some
unexpected political or economical arise.
Mohd. Suhaili, MPOC HQ
MARKETInsights Ins g
Continued from page 7
2nd Quarter CPO price forecast Current drop
in CPO price revived the Biodiesel sector in
Malaysia and Indonesia
MPOC
Offices
Worldwide
Malaysian Palm Oil Council (MPOC)
2nd Floor Wisma Sawit
Lot 6, SS 6, Jalan Perbandaran
47301 Kelana Jaya, Selangor
Tel: 603-7806 4097
Fax: 603-7806 2272
www.mpoc.org.my
American Palm Oil Council
1010 Wisconsin Av, Suite 307
Washington DC 20007
Tel: +1 (202) 333 0661
Fax: +1 (202) 333 0331
www.americanpalmoil.com
E-mail: kassim@americanpalmoil.com
Contact: Mohd Salleh Kassim
MPOC Africa Regional Office
5 Nollsworth Crescent, Nollsworth Park
La Lucia Ridge Office Estate,
La Lucia 4051, KwaZulu-Natal, South Africa
Tel: +27 (31) 5666 171
Fax: +27 (31) 5666 170
E-mail: kazmi@mpoc.org.za
Postal Address:
P.O.Box 1591
M.E.C.C. 4301, South Africa
Contact: Kamal Azmi
MPOC Bangladesh
62-63 Motijheel Commercial Area,
7th Floor, Amin Court Building,
Dhaka, Bangladesh
Tel: +88 (02) 9571 216
Fax: +88 (02) 9551 836
E-mail: fakhrul@mpoc.org.bd
Contact: Fakhrul Alam
MPOC Shanghai
Shanghai Westgate Mall Co. Ltd.
Room 1610B, 1038 Nanjing Rd. (w)
Shanghai 200041, P. R. China
Tel: +86 (21) 6218 2085 / 6218 2513
Fax: +86 (21) 6218 1125
E-mail: teah@mpoc.org.cn
Contact: Teah Yau Kun
MPOC Pakistan
11 3rd Floor, Leeds Centre
Main Boulevard Gulberg, 111 Lahore, Pakistan
Tel: +92 (42) 3571 6600 / 3571 6601
Fax: +92 (42) 3571 6602
E-mail: faisal@mpoc.org.pk
Contact: Faisal Iqbal
MPOC India
S-4, New Mahavir Building, Cumballa Hill Road
Kemps Corner, Mumbai 400 036
Tel: +91 (22) 6655 0755 / 6655 0756
Fax: +91 (22) 6655 0757
E-mail: bhavna@mpoc.org.in
Contact: Bhavna Shah
MPOC Europe Regional Office
31 Avenue Emile Vendervelde
1200 Brussels Belgium
Tel: +32 (2) 7748 860
Fax: +32 (2) 7794 371
E-mail: kumar@mpoc.eu
Contact: Uthaya Kumar
MPOC Moscow
Moscow, 4th Dobrininskiy side-street,
8 BC 'Dobrinya', 1st floor, Office R00-126
Tel : +790 963 520 40
Email: udovenko@mpoc.org.my
Contact: Aleksey Udovenko
MPOC Cairo
3 Gamal E1-Din Afify Street, Nasir City
Zone No.6, 11371 Cairo, Egypt
Tel: +20 (2) 2273 8108
Fax +20 (2) 2273 8106
E-mail: zainuddin@mpocegypt.com
Contact: Zainuddin Hassan
MPOC Istanbul
Guzel Konutlar Sitesi
Dilek Apartment Daire 3
Balmumcu, Besiktas - Istanbul, Turkey
Tel: +90 (212) 2668234
Fax +90 (212) 2668236
E-mail: haznita@mpoc.org.my
Contact: Norhaznita Husin Publisher: Malaysian Palm Oil Council (MPOC)
2nd Floor Wisma Sawit, Lot 6, SS 6,
Jalan Perbandaran, 47301 Kelana Jaya, Selangor
Printed by: Aktiara Corporation Sdn Bhd
1 & 3, Jalan TPP 1/3, Taman Industri Puchong
Batu 12, 47160 Puchong, Selangor
multilateral (WTO), regional (EU-ASEAN,
EU-ACP, etc.) and/or bilateral level. However,
the argument can be made that, if the EU and
palm oils producing countries were to define
and agree to a set of mutually-recognised
standards and conformity assessment
procedures that could certify palm oils
environmental sustainability (in general or
limited to the production destined for food
applications), this would already greatly
diminish the appeal and effectiveness of the
highly-damaging palm oil free campaigns in
EU producers and consumers minds.
Trade facilitation mechanisms and dedicated
chapters could be engineered within the
framework of the relevant preferential trade
agreements with the EU to the sole benefit of
palm oil trade. Multilaterally, this issue could
be systematically taken up in all relevant fora
(i.e., the TBT Committee, the Council for
Trade in Goods, etc.), as many other
countries are doing with respect to the
increasingly contentious issue of the use of
private standards and their effects on trade,
as well as with respect to the EUs
sustainability requirements. If need be, the
WTO dispute settlement mechanism may also
be resorted to and third Governments (de
facto if not de jure) discriminatory and illegal
practices should be challenged.
Market access can only be preserved if a
comprehensive, effective and well-defined
strategy is adopted and implemented by the
palm oil industry. There is no silver bullet.
The EU market is still an attractive and
lucrative one, but it is also highly sophisticated
and regulated by complex, costly and
resource-intensive mechanisms. As the
MPOC continues its battle to defend the good
name of palm oil in Europe and around the
world, this strategy must attract the support
and pro-active engagement of the natural
allies of palm oil: the Governments of palm
oil-producing and -exporting countries, palm
oils EU importers, processors and customers,
and the many other industries that have a
systemic interest at stake and that should be
worried by the regulatory and market
developments that are taking place against
palm oil and that represent dangerous
precedents. Kumar, MPOC Europe
This article is based on presentation made by
Ms. Eugenia Costanza Laurenza, Associate,
FratiniVergano European Lawyers,
Brussels, Belgium at the European Palm oil
Conference held in Paris, France, recently.
C
O
M
P
L
E
T
E
D
C
O
M
P
L
E
T
E
D
MARKETInsights Ins g
Continued from page 10
European Policies & Legislation Impacting
Food Labelling and Biodiesel: Current &
Post 2014