Malaysian crude palm oil (CPO) prices are expected to range higher at between RM5,000 and RM5,500 per tonne in the fourth quarter (4Q) of this year, said Plantation Industries and Commodities Minister Datuk Zuraida Kamaruddin.
This is due to the resumption of Indonesia’s palm oil export levy beginning September 1, and the expected decline in palm oil production in 4Q, she said.
According to Zuraida, the CPO price rose by 55.9 per cent to RM6,330.00 per tonne during the January-June 2022 period from RM4,061.50 per tonne in the same period last year.
“The higher CPO price during that period was influenced by higher prices of soybean oil (SBO); palm oil stocks remained at manageable levels; firmer Brent crude oil price; and concerns over disruptions of vegetable oil supply from the Black Sea region following Russia’s invasion of Ukraine,” she said in a statement today.
Zuraida also noted that the recent move by Jakarta to scrap its export levy for all palm oil products until August 31 in a fresh attempt to boost exports and ease high inventories would imply that CPO prices are likely to remain weak for most of the third quarter (3Q) 2022.
“This is inevitable in light of stiffer competition from Indonesia – the world’s largest palm oil producer – in its quest to flush out as much excess palm oil as possible from its existing stockpile.
“The average CPO price for 3Q 2022 is projected to range between RM4,800 and RM5,200 per tonne. For the record, the daily CPO price declined to RM3,631.50 per tonne or 24.9 per cent on July 15 from RM4,838.50 per tonne on July 1,” she added.
