Vegetable oil still under pressure

By FWi Staff

WITH the market having digested the news about a lower than expected EU rapeseed crop, attention is now being drawn back to the oil markets.

Rape oil, soya oil and in particular palm oil markets remain under pressure from oversupply and subdued demand. Palm oil has become the cheapest oil, in response to increased competition from competitively priced soya oil from the US and South America, while rape oil has emerged as the most expensive.

In a means to improve the flow of exports, Indonesia and Malaysia, the worlds two largest palm oil producers, are considering easing their export tax on crude palm oil.

Palm oil production is expected to rise to 10.7m tonnes in Malaysia and to 6.7m in Indonesia this year.

The importance of maintaining their export markets is vital as Malaysia exports about 90% of its palm oil output and Indonesia more than 50%.