Palm oil exports from Indonesia climb for first month since May

JAKARTA, Oct 14 — Palm shipments from Indonesia advanced in September for the first time in four months on reduced supplies of substitute oils, boosting demand for the most-consumed cooking oil from the world’s biggest producer.

Exports gained 11 per cent to 1.64 million metric tonnes from 1.48 million tonnes in August, the Indonesian Palm Oil Association said in a statement e-mailed today. That’s the first advance since May, when sales jumped 21 per cent, and compares with 1.38 million tonnes in September 2012, data compiled by Bloomberg show. The median of estimates from four plantation executives and an industry official in a Bloomberg survey was for an increase to 1.6 million tonnes. The survey was conducted before today’s data.     

Rising palm demand may extend a rally in futures that slumped to an almost four-year low in July on prospects for record global supplies. US reserves of soybeans, crushed to make soybean oil, were at their lowest in four years last month. While US farmers will collect a record bean crop this year, the harvest progress trailed a five-year average as of September 29, government data showed.

“Delays in the US soybean harvest because of rain in the Midwest and sunflower harvest in Russia and Ukraine have drastically cut shipments of oilseeds,” and that has led to an increase in palm oil demand, said the planters and refiners association, called Gapki.

Imports by India, the world’s biggest buyer, jumped 23 per cent to 431,240 tonnes and purchases by China, the biggest cooking oil consumer, climbed 7.3 per cent to 182,740 tonnes, according to Gapki. Exports to the U.S. surged 68 per cent to 57,170 tonnes in September from a month earlier.

Four-year low

The contract for delivery in December traded at RM2,370 (US$746) a tonne on the Bursa Malaysia Derivatives, by 12:29pm in Kuala Lumpur. Prices dropped to RM2,137 in July, the lowest level since October 2009.

Farmers in South America delayed soybean planting because of dry weather, while rain curbed sunflower harvests in Ukraine and Russia, Hamburg-based Oil World said in an October 1 report.

Exports from Malaysia rose 5.2 per cent to 1.61 million tonnes in September, rising for a fourth month, the Malaysian Palm Oil Board said October 10. Malaysia is the biggest producer after Indonesia. — Bloomberg