Xinhua Silk Road - Belt and Road Portal, China's silk road economic belt and 21st Century Maritime Silk Road Website Xinhua Silk Road - Belt and Road Portal, China's silk road economic belt and 21st Century Maritime Silk Road Website
Subscribe CustomBlackClose

Belt & Road Weekly Subscription Form

download_pop

Research ReportCustomBlackClose

The full edition of the report is available at Xinhua Silk Road Database. You can click the “Table of Content” to have a general understanding of it.

Click on the button below to create your account and get immediate access to thousands of articles.

Start a Free Trial

Xinhua Silk Road Database
Economy

Malaysia's palm oil exports set to rise following export tax suspension

January 08, 2018


Abstract : Malaysia, the world's second largest palm oil producer after Indonesia, may see its palm oil exports increase after its government suspends export taxes on crude palm oil (CPO) from Monday.

棕榈油

KUALA LUMPUR, Jan. 8 (Xinhua) -- Malaysia, the world's second largest palm oil producer after Indonesia, may see its palm oil exports increase after its government suspends export taxes on crude palm oil (CPO) from Monday.

Malaysian Plantation Industries and Commodities Minister Mah Siew Keong announced recently the suspension of export taxes on CPO for three months from Jan 8 Monday to April 7, in a bid to boost palm oil prices and reduce high stockpiles.

The taxes removal, however, will end early if CPO stocks fall to 1.6 million tons.

According to Malaysian Palm Oil Board, Malaysia's CPO export tax for January 2018 was 5.5 percent; Malaysia's stockpile in November 2017 stood at a two-year high of 2.56 million tons.

Analysts said the export taxes suspension is expected to improve Malaysia's CPO exports competitiveness and give a short-term boost to its exports to major importers such as China and India.

"This will help boost CPO exports from Malaysia as it will be more competitive against Indonesian CPO exports, which are subject to a CPO levy of 50 U.S. dollar per ton," said CIMB Research's analyst Ng Lee Fang.

She sees it as a positive move for Malaysian planters in the near term as based on the latest export taxes, it would allow CPO exporters in Malaysia to save 144 ringgit (36.1 U.S. dollar) per ton.

"We also believe that major consumers such as India and China will take this opportunity to buy more palm oil from Malaysia," said MIDF Research's analyst Alan Lim, adding that the demand from China is supported by pre-stocking activity ahead of the Chinese New Year in mid-February.

Concurred with Lim, Public Investment Bank Research's analyst Chong Hoe Leong believed the move will give a boost to Malaysia's palm oil exports amid the upcoming Chinese New Year celebration.

"Price sensitive importers like India will likely import more while China, the second largest palm oil importer, will also lock in more orders as demand picks up ahead of Chinese New Year in February," he added.

But he also pointed out the possibilities of similar measures by other countries.

"Indonesia, the world largest palm oil producer, might also roll out some incentives to undercut the CPO prices in order to push for their palm oil exports," he said.

Scan the QR code and push it to your mobile phone

Keyword: exports Malaysia-economy palm-oil

Write to Us belt & road login close

Do you want to be a contributor to Xinhua Silk Road and tell us your Belt & Road story? Send your articles to [email protected] and share your stories with more people.

Click on the button below to create your account and get im http://img.silkroad.news.cn/templates/silkroad/en2017te access to thousands of articles.

Start a Free Trial

Ask Us A Question belt & road login close

If you have any questions, please enter them in the box below.

Identifying code Reload

Write to Us belt & road login close

Do you want to be a contributor to Xinhua Silk Road and tell us your Belt & Road story? Send your articles to silkroadweekly@xinhua.org and share your stories with more people.

Click on the button below to create your account and get im http://img.silkroad.news.cn/templates/silkroad/en2017te access to thousands of articles.

Start a Free Trial