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KUALA LUMPUR, Jan 7 — Demand for Malaysian palm oil in Pakistan is expected to peak next month in conjunction with the upcoming Ramadan celebrations, said an industry expert.
Westbury Group of Companies chief executive officer Abdul Rasheed Janmohammed said February would be the main month of spending in preparation for Ramadan in April.
“The shorter month will be the focal month of demand for Malaysian palm oil,” he said at the Malaysian Palm Oil Trade Fair and Seminar 2021 (POTS Digital 2021).
The virtual event, into its third day and will end tomorrow, is organised by the Malaysian Palm Oil Council.
Having said that, Abdul Rasheed believes that the crude palm oil (CPO) price forecast on the Bursa Malaysia Derivatives (BMD) for the first quarter of this year should be between RM3,100 and RM3,300 per tonne to attract demand.
Noting the excessive increase of CPO price to almost RM4,000 per tonne currently, he opined that it would be rather taxing on price sensitive countries such as Pakistan, to purchase the commodity.
Consequently, he is urging the government of Pakistan to review its current duty structure, which is unbearable for its citizens to import and meet the demand for CPO.
“They did a good job by reducing the CPO duty by 10 per cent a couple of months ago.
“(But) The market needs to be corrected somewhere to spur demand and let’s hope 2021 will be good for everyone,” he said, adding that the Malaysian palm oil stocks last November were 1.56 million tonnes.
The CPO price was RM3,720 per tonne last December and the lowest was RM1,947 per tonne in May.
Abdul Rasheed said Pakistan had a swing of almost 47.66 per cent on the BMD throughout last year, which was indeed a huge influence.
“No one can predict such a big change in the market. If you have this 47 per cent swing prices, I think nobody could plan on the short or long term. It was a difficult year for palm oil refiners, buyers and traders.
“I still remember the first half of last year when the CPO price was RM3,000. In March, Covid-19 came and we saw the market going back to the year 1947 in a short span,” he said.
The Westbury Group of Companies is engaged in refining processing of crude edible oils and has the largest refinery of edible oils in Pakistan. — Bernama