MALAYSIAN PALM OIL COUNCIL

KKDN PP 14669/05/2013 (032704)

VOL: 1 2013
MARKETING & MARKET
DEVELOPMENT DIVISION

Logistics - Challenge
to Oils and Fats

DIRECTOR
Faudzy Asrafudeen Sayed Mohamed
faudzy@mpoc.org.my
MANAGERS

Imports into Russia

Muhammad Kharibi Zainal Ariffin

kharibi@mpoc.org.my
Mohd Izham Hassan
izham@mpoc.org.my
MARKET ANALYSTS
Asia Pacific
(China)
Asia Pacific
(Excl. China)
South Asia
Middle-East
Africa
Europe
Americas

Name of district

Population

Administrative center

Central Federal District

Southern Federal District
North Western Federal District
Far Eastern Federal District
Siberian Federal District
Urals Federal District

38,438,600
13,856,700
13,583,800
6,291,900
19,254,300
12,082,700

Moscow
Rostov-on-Don
Saint Petersburg
Khabarovsk
Novosibirsk
Yekaterinburg

Volga Federal District

North Caucasian Federal District

29,900,400
9,496,800

Nizhny Novgorod
Pyatigorsk

GENERALLY speaking, Russia is an

enormous country. About 145 million
people live on the territory of 17 million
sq-km. The bulk of the population is
concentrated in the Central and Volga
Federal Districts. The potential of the
market is huge. Roughly speaking,
exports of oils and fats can be as high as
one million metric tonnes (MT) and more.
This is 40% to 50% larger than the
current imports.
This enormousness complicates logistics
for the delivery of palm oil in bulk. If we
are keen about this market, we must
prepare for a long haul. From the very
first step, we have to set out the final
points of delivery. The final choice must
be between the basins of the Black Sea
and Baltic Sea.

For more information, please contact

Tel : 603 - 7806 4097 Fax: 603 - 7806 2272

So, the situation is complicated but we

should not be overly concerned for the
market is huge and we can assist with the
task. Therefore, there are some steps we
must take to effectively tap the huge
Russian market.

number of facts must be noted. The main

ports of the Black Sea are located on the
side of Ukraine. Yuzhny, Odessa and
Ilyichevsk have deepwater berths. This
gives them a preference in the import of
palm oil to Russia. The Port of Taman
and Port of Novorossiysk are located in
Russia, but because of a number of
reasons, they are in a less favorable
position.
Another fact complicating the import of
tropical oils to Russia is that Russia has
limited capacity for handling and
transshipment of tropical oils. Ukraine
has over 200,000 MT of the
transshipment capacity, while Russia has
less than 80 000 MT.
Jan - Dec, 2012

Lim Teck Chaii

lim@mpoc.org.my
Mohd Hafezh Bin Abdul Rahman
mhafezh@mpoc.org.my
Fatimah Zaharah Md Nan
fatimah@mpoc.org.my
Mohamad Suhaili Hambali
msuhaili@mpoc.org.my
Nor Iskahar Nordin
iskahar@mpoc.org.my
Azriyah Azian
azriyah@mpoc.org.my
Amir Zarif Ahmad Anwar
amir@mpoc.org.my

First of all, the key to success would be

the port of discharge. The choices are
limited, so an important first step is to
establish contacts with the port
authorities. The reason for this is that
Russia mainly exporting raw materials,
such as oil, gas, coal, metal and wood,
while import-export of food products
takes up no more than 1% (See page 7).
Russian port authorities will think twice
before approving the construction of a
terminal. In some ports, for example St.
Petersburg, space is severely limited and
the port authority will prefer working with
an exporter of resources rather than an
importer of edible oils.
Second, freight from Malaysia to Russia
takes long time, 25 to 30 days. There
Continued on page 7

Volume (MT)

Value (RM million)

We are talking about bulk, because bulk

deliveries make the bulk of imports of
up to 53% (See table below).

PALM OIL

59,494

173.39

PALM KERNEL OIL

8,380

42

OLEOCHEMICALS

7,064

35

When making a choice between these

two seas, we must first find a proper
seaport. Looking at the given choices, a

FINISHED PRODUCTS

12,023

75

86 961

325

TOTAL

Source: MPOB
MPOC FORTUNE

M A RKET W at c h

FCPO: Bullish
momentum is weak

by Benny Lee
Chief Market Strategist
of NextView Group

Palm oil prices started to feel some

pressure after trying to test the RM2,600
per metric ton resistance level twice in the
past one month. The failure to climb
above this level shows resistance and
chart wise, the price movement has
formed a double top chart pattern which
means a pullback is expected. Export
estimates were lower than expected as
the government decided to lift the zero
export tax in March and impose a 4.5%
tax. FCPO rose 2.7% in a month to
RM2,532 on 22 February after trading
between RM2,442 and RM2,593. Trading
volume has declined with 15,700
contracts traded on average daily in the
past one month as compared to 16,400
contracts in the previous month.
Malaysian Palm Oil Board reported that
Malaysian palm oil inventories eased
1.9% at the end of January from the
previous month to 2.58 million metric
tons. January exports, however, have
declined 1.6% from the previous month at
1.62 million tons. The inventory eased
because of lower palm oil production.
Palm oil output in January fell 10% to 1.60
million tons. Demand for palm oil will be
questionable as the government decided
to raise tax as inventory remains at very
high levels. Recent data from cargo
surveyors show that export as started to
feel some pressure. Exports were positive
in the beginning of the month of February
but eased of later. According to cargo
surveyor SGS(M) Sdn Bhd, February
1-20 exports was estimated to ease 0.3%
to 835,612 tons from the same period in
the previous month. Earlier, they reported
an increase of 25% in exports in their 1-10
February estimates.
FCPO seem to be struggling to break
above the RM2,600 resistance level and
in my recent forecast in the Palm Oil
Internet Seminar (POINTERS) organized
by the MPOC, I highlighted that unless
the RM2,600 resistance level is broken in
the next two months, price is unlikely
going to rally and may just remain
sideways. In the past one month, FCPO
managed to break above RM2,500
immediate resistance level and rallied to
near RM2,600. Then it pulled back and
with the current information and data,
price may continue to fall and test

FCPO daily chart as at 22 February 2013.

Charted by Benny Lee using NextView Advisor Professional
RM2,500, the previous immediate
resistance level now turned support level.
The 30 to 90 day moving averages have
started to increase last month, signalling
possible trend reversal. The trend has
been bearish since May last year. FCPO
is currently lightly above these averages
that range between RM2,420 and
RM2,480. The price is also above the
Ichimoku Cloud indicator, the first time
since May last year. All these indicators
indicate that FCPO has found strong
support in the past few months and is
geared for a reversal. The reversal is
confirmed if the price breaks above
RM2,500 and the price did just that.
However, the failure to break above
RM2,600 twice in the past one month
shows resistance at this level and
momentum indicators beginning to
decline. As FCPO price formed to short
term pivot highs the past one month at
RM2,600, momentum indicators such as
RSI, MACD, and Momentum oscillators
pivot higher are declining and this
indicates a divergence or weakness in the
current short term up trend. The MACD
has crossed below its moving average,
indicating a bearish reversal in the short
term up trend.

After a steady bullish rally since the

beginning of this year, FCPO is
overbought in the short term and
therefore pullbacks are expected.
However, extended pullbacks indicate
weak bullish sentiment and market may
consolidate. With the current data and
aggressive declines in commodities
prices especially crude oil, FCPO price
may test RM2,500 support level and if it
breaks below RM2,500, we may see
extended correction downwards with the
next support level at RM2,300. Market
may remain bullish if the price can stay
above RM2,500.
Mr. Benny Lee is an established
trainer and sought-after speaker in the
financial market. He is the Chief
Market
Strategist
for
Jupiter
Securities. He can be contacted at
bennylee.kl@gmail.com
The above analysis and commentary
is based on the writers personal
opinion towards the price of crude
palm oil using technical analysis and
should not be construed as any form
of investment advice. The writer will
not be responsible for any decision
made from using the above article .
MPOC FORTUNE 3

Malaysias Largest Independent

Common-user Multi-purpose Liquid
Bulk Terminal Operator

North Port, Port Klang

- Fima Bulking Services Berhad
- Fimachem Sdn Bhd
- Fima Liquid Bulking Sdn Bhd
- Fima Freight Forwarders Sdn Bhd
Butterworth
- Fima Palmbulk Services Sdn Bhd

Located in a free commercial

zone offer excellent
opportunities for
Import and export
Transhipment
MDEX tender (approved
delivery point)
Regional collection /
distribution hub
Facilities available :
Carbonsteel
Coated & stainless tanks come
with heating facilities &
nitrogen blanketing.

Jalan Parang, 2nd Extension, North Port, 42000 Port Klang, Selangor, MALAYSIA
Tel: +603 - 3176 7211 Fax: +603 - 3176 5641 Email: enquiry@fimabulking.com

http://www.fimabulking.com

M AR KET Ins
In sigh
g ts

Palm Oils Strong Foothold

in Bangladesh Market

Bangladesh is one of the most populous

countries of the world, with a population of
about 152 million living in an area of
147,570 sq-km. The population is growing
at about 1.34% a year. Bangladesh is a
developing country, maintaining a GDP
growth rate of about 6% in the last decade.
In 2011-12, the per capita GDP of
Bangladesh was US$772. Due to a steady
growth in GDP, the countrys economy is
moving ahead and its economic
improvement is contributing to the
increased purchasing power of its people.
According to the International Monetary
Fund (IMF), Bangladesh ranked as the
44th largest economy in the world in 2012,
with a GDP of US$118.8 billion.
Oils and fats situation
Bangladesh is deficit in edible oils and
fats production as the country is able to
produce only about 10% of its
requirements and has to import the
remaining.
Palm,
soybean
and
canola/mustard oils are the three major
edible oils consumed in the country.
Mustard oil is the traditional edible oil
consumed in virgin form, but its use has
been limited due to its higher price and
lower production in the country. Some
canola seed is imported to fill the gap
between demand and local production.
Imported canola is crushed locally and
the oil obtained is marketed in virgin form.
Palm oil is imported both in crude and
refined forms. Crude palm oil (CPO) and
crude palm olein (CPL) are refined locally
and marketed, while the refined palm oil
and refined palm olein imported are used
by vanaspati manufacturers and food
processing industries. Soybean oil is
imported in crude form and refined
locally. Some soybean is also imported,
crushed and refined for the local market.
Vanaspati and butter/ghee are the major
edible fats. Coconut oil and linseed oil are
used for inedible purposes. Edible oils
and fats constitute about 97.5% of the
total oils and fats consumed in the
country, with the remaining being inedible
oils and fats.

Yearwise Import of 3 Major Edible Oils vis-a-vis

Total Oils & Fats: 2007 - 2012
1,800
Quantity in (000) tonnes

THE IMPORT volume of palm oil by

Bangladesh in 2012 once again exceeded
one million metric tonnes, reaching
1,027,194 MT and surpassing the
previous highest record of 1,023,128 MT
achieved in 2009. With palm oil being the
leading edible oil of the country for a
decade, its import volume has always
been above 60% of the total annual import
of oils and fats in the last couple of years.

1,600
1,400
1,200
1,000
800
600
400
200
0

2007
Palm Oil

2008

2009

2010

Soyebean Oil

2011

2012

Rape/Mustard Oil

Total

Source: MPOC Market Intelligence/ Chittagong port and Bulk Storage Terminals
Note:
1. Canola/Mustard oil quantity is the oil equivalent of imported seeds at 38% oil extraction.
2. Soybean oil quantity includes the imported crude soybean oil and the crude soybean oil
equivalent of imported soybean at 18% oil extraction.

Imports of oils and fats

In 2012, the total oils and fats imported
created history, hitting a new high. It
exceeded the 1.5 million MT benchmark
for the first time, touching 1,613,490 MT
or 10.12% higher than in 2011. Imports of
total oils and fats registered a good
growth due to the increase in demand for
palm, soybean and canola/mustard oils,
thereby boosting imports of palm and
soybean oils as well as soybean and
canola/mustard seeds.
The increased prices of agricultural
commodities also helped to upgrade the
lifestyle, and simultaneously the food
habits of people in the rural areas, where
about 80% of the population lives,
thereby
contributing
to
increased
consumption of cooking oil, especially
palm oil. Besides, increased use of palm
oil by the local food processing industries
also contributed to some extent to the
increased import of palm oil, while the
increased consumption of soybean oil in
urban areas boosted the import of this oil.
The import of palm oil reached its highest
record of 1,027,194 MT in 2012, which is
higher by 8.23% compared with the 2011
import. Palm oil includes CPO, CPL &
RBD PO/PL while soybean oil includes
CDSBO and crude soybean oil obtained
locally by crushing imported soybean.
Canola/mustard oil is extracted from
imported canola/mustard seeds.
Besides these, some refined edible oils,
other than palm oil, are also imported but

the import volumes are small. Some

butter oil and ghee/vegetable ghee/
shortenings/margarines
are
also
imported in small quantities to meet the
local demand.
Among the three major edible oils, the
average import share of palm, soybean
and
canola/rape/mustard
oils
are
respectively in the ratio 65:31:4. Coconut
oil, crude/RBD PS and PFAD are imported
as raw materials for the cosmetics and
soap industries and PKO is used by the
chocolate, ice cream and soap industries.
Their combined annual import volume
does not exceed 30,000 MT.
On an average, Bangladesh each year
has to spend more than US$1 billion on
the import of edible oils and fats and this
amount is gradually increasing. The sum
spent on the import of oilseeds is about
US$100 million.
At present, the annual wholesale market
price of edible oils and fats consumed in
the country is about Taka 173.8 billion
(US$2.12 billion), which in the retail
market is about Taka 197 billion (US$2.4
billion). As about 90% of the edible oils
requirements are met by imports, with the
local prices of edible oils and fats
fluctuating in tandem with the prices in the
international market.
Import Tariffs
At present, the import duties on bulk
import of CPO, CPL, RBD PO & RBD PL
Continued on page 6

MPOC FORTUNE 5

MARK ET I ns
nsights
Continued from page 5

Palm Oils Strong Foothold in Bangladesh Market

Table 1: Import of three Major Edible Oils vis--vis Total Oils and Fats(000 MT)
Year
2012
2011
2010
2009
2008
2007

Total Oils
and Fats
1,613.5
1,465.2
1,452.5
1,496.2
1,096.8
1,207.1

Change
(%)
+ 10.12
+ 0.88
- 2.92
+ 36.41
- 9.13
-

Palm Oil

Change
(%)
+ 8.23
+ 2.03
- 9.09
+ 25.39
+ 40.39
-

1,027,194
949,075
930,147
1,023,128
815,955
581,183

Soybean
Oil
491,877
422,301
435,484
396,853
217,278
508,441

Change
(%)
+ 16.47
- 3.03
+ 9.73
+ 82.65
- 57.27
-

Canola/
Mustard Oil
64,777
59,711
57,381
43,918
26,840
72,891

Change
(%)
+ 8.48
+ 4.06
+ 30.65
+ 63.63
- 63.18
-

Source: MPOC Market Intelligence/ Chittagong Port/Bulk Storage Terminals

Note:
3. Canola/mustard oil quantity is the oil equivalent of imported seeds at 38% oil extraction.
4. Soybean oil quantity includes the imported crude soybean oil and the crude soybean oil equivalent of imported soybean at 18% oil extraction.

Import of Malaysian Palm Oil (MPO)

Import of MPO by Bangladesh greatly
improved in 2012, climbing to 269,661
MT or a 93% increase over the 2011
figure. The import share of MPO in 2012
was 26% of the total import of palm oil
and the rest 74% was that of Indonesia
Palm Oil (IPO). In 2011, the import shares
of MPO and IPO were in the ratio of
15:84.
The active presence of a few MPO
suppliers in the Bangladesh market and
the changing of their supply source to
Malaysian
suppliers
by
some
Singapore-based trading houses largely
contributed to the increased import of
MPO by Bangladesh.
Oils and Fats Consumption
According to Oil World, Bangladesh has
been one of the fastest growing oils and
fats market in recent years, driven by
population and economic growth. The
consumption of oils and fats in 2012-13 is
likely to stand at 1.8 million MT, or a 71%
growth over the last 10 years, and with
the per capita consumption approaching
12kg. In terms of total usage, Bangladesh
has overtaken South Korea and Taiwan
in recent years. At present, about 85% of
oils and fats consumed in the country are
in the form of liquid oil, while only about
15% is used in the solid form, that is, for
shortenings, vanaspati and ghee/butter.
About 80% of oils and fats consumed in
the country annually are sold in loose
form. Palm oil dominates in the loose
selling market while soybean oil
dominates in the consumer pack market.
6 MPOC FORTUNE

Table 2: Import Expenses for Import of

Edible Oils and Oilseeds 2009 to 2012 (USD Million)
Commodity

2009-10 July June

2010-11 July June

2011-12 July Feb

Edible Oils

1,050

1,060

1,174

Oil Seeds

130

103

94

Source: Bangladesh Economic Survey, 2012

Table 3: Annual Traded Value of
Major 3 Edible Oils at Wholesale Level: 2010-12 (USD Million)
Year

Soybean Oil

Palm Oil

Mustard Oil

Total

2010
2011
2012

317
541
717

830
1,185
1,172

154
195
233

1,301
1,921
2,122

Source: MPOC Market Intelligence

Yearwise Annual Traded Value of Major 3 Edible Oils
at Wholesale Level: 2010 - 2012
2,500
In Million US$

and CDSBO are zero, but there is 10%

value added tax (VAT) on C&F value,
while the import of oilseeds enjoy zero
import duty and zero import VAT. The
import duty for import of refined olein,
soybean oil and sunflower oil in consumer
packs is zero, but there is a 15% import
VAT and 4.5% Advance Income Tax.
However, the import of RBD PO and RBD
PL in bulk is restricted only for
vanasapti/shortening producers.

2,000
1,500
1,000
500
0

2010
Canola/Mustard Oil

Palm oil is used as cooking oil and also as

one of the important raw materials for
shortening/vanaspati and food industries.
Ghee and butter are used only for
preparing
special
dishes
during
occasions and festivals. Butter is also
used as bread spreads at the breakfast
table, but on a very limited scale.
The major industrial consumer of oils and
fats in Bangladesh is the bakery industry.
There are about 3,000 bakeries in the
country, mostly non-mechanised. The
mechanised
bakeries
mainly
use
shortenings/vanaspati but most of the
non-mechanised ones use liquid oils.
Biscuit and bakery industries prefer to
use palm oil, whether in liquid or in solid

2011
Soyebean Oil

2012
Palm Oil

Total

form. At present in Bangladesh,

vanaspati/shortening is produced only
from palm oil. Annual production of
vanaspati/shortenings in the country is
about 250,000 MT.
The other food industries, such as the
manufacturing of potato chips, fried
foods, instant noodles, condensed milk
and chocolates, prefer to use palm oil.
Besides
these
industries,
hotels,
restaurants and fast food outlets also
consume a considerable quantity of palm
oil and vanaspati/ shortenings prepared
from palm oil. Local pickle industries
consume
a
good
quantity
of
canola/mustard oil.
Continued on page 9

Sea Port of Taman

Max Draft - 9m
Berth length - 225m
Bulking capacity - 60,000 MT
Sea Port of Odessa
Max Draft - 13m
Bulking capacity - 45,000 cu-m
Sea Port of Ilyichevsk
Max Draft - 14m
Bulking capacity 1 - 90,000 cu-m
Bulking capacity 2 - 3, 000 cu-m
Sea Port of Yuzhniy
Max Draft - 15m
Bulking capacity - 100,000 MT
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%

Baltic ports are difficult enough for delivery.

The main reason is the period of ice. The
other reason is depth of the Gulf of Finland
(average depth 38m bay, compared with the
Black Sea at 1,240m).
As seen, Rotterdam and Amsterdam are
much better in terms of logistics. Because of
the distance from the main shipping lines, the
port of S. Petersburg will never be interesting
for transoceanic companies.

M A R K E T I ns
nsi g
ght s

Logistics - Challenge
to Oils and Fats
Imports into Russia

But still, the Baltic ports of Russia are very

promising. The port of St Petersburg is the
largest, while the port of Ust-Luga is one of the
most dynamically developing ports of Russia.

Russia: Pattern of import by the main groups

Oil
(Miniral)

Petrochemicals

Metal
(ferrous)
62.3

Grain

Coal

52
33.9

26

Food

44

7.2
Finland ports

Baltic ports

Total Transit, mio MT

Ukrainian ports
Liquid Cargoes, %

Continued from page 1

have been cases prices decreased while

the cargo was in transit, and the Russian
buyers declared a default on the contract.
Situations like this always put exporters
into a difficult situation. The solution here
is quite simple: Construct a terminal for
palm oils that will ensure the continued
availability of the oil in Russia.
Continuously available stock means a lot.
Third, is the quality of the oil which is the
cornerstone of Russias oils & fats
requirement. The country in recent years
has deployed a real requirement for
quality. Some want to see PV below 1,
some disagree and insist on 2 (10 at the
end of storage). Although, the beautiful
slogans of fighting for quality are hiding
financial interests of certain companies,
this cannot be ignored. Therefore, it is
best to have an option to refine oil after
delivering. Refineries in the proximity
would be perfect.
In the fourth place are the finished
products. Consideration of the structure
of imports in Russia, we talked about
importing in bulk. This is important part,
but one can not discount the finished
products, which will be more profitable.
Continued on page 11

TOP 10 SEA PORTS OF RUSSIA

Port

Region

Transshipment Draft, m
Capacity

Owner

Specifications

Novorossiysk

Krasnodar krai
Azov & Black

55

13.6

LUKoil, Russian General

Bank, "Delo"

St Petersburg St Petersburg
Sea Port
Baltic
3 Ust-Luga
Leningrad
(St Petersburg)
Baltic
4 Indiga
Nenetskiy AO
Northen
5 Eastern
PrimorskyKrai
Far East
6 Tuapse
Krasnodar krai
Azov & Black
7 Batareinaya
Leningrad
(St Petersburg)
Baltic
8 Olya
Astrakhan
Oblast
Caspian
9 Primorsk
St Petersburg
Baltic
10 Kaliningrad
Kaliningrad
Oblast
Baltic

35

11.5

35

N/A

State property (48.79%),

NasdorInc. (49.28%)
UstLuga,Sokolovskaya

Mineral oil, grain, raw sugar,

cement, metal, pipes, containers,
fertilisers, wood, paper,
construction materials
Wood, cellulose, containers,
metal ferrous.
Coal, cellulose, mineral oil, metal.
Under construction

30

N/A

LUKoil

Mineral oil. Under construction

20

16.5

Severstaltrans (60%)

20

13

Severstaltrans (67%)

15

12

Surgutneftegas
(Surgut Oil and Gas)

Coal, metal, containers, wood,

equipment, fertiliser
Mineral oil, coal, metal, mineral,
bauxite, grain, raw sugar
Mineraloil. Under construction

14

N/a

State property

12

12

Balt port (50%)

9.5

Dork ltd (31.31%)

Metal, wood, paper, cartons,

cellulose, containers, equipment.
Under construction
Mineral oil
Cellulose, metal, coal, alloys,
fertiliser, containers
MPOC FORTUNE 7

MARK ET I ns
nsights

Palm Oils Strong Foothold in Bangladesh Market

Although industrial consumers are quite

aware about palm oils compatibility as an
important raw material for the food
industry, domestic consumers, in general,
have a poor perception about palm oil.
MPOC has been trying to change the
perception of the consumers by
organising
various
promotional
programmes and media campaigns
undertaken each year. However, the
change of perception is a slow process
and it will take a long time to make the
majority of the general consumers aware
about palm oils beneficial attributes. In
the wholesale market, palm oil is traded in
the name of palm oil and industrial
consumers prefer to buy it but in the retail
market, where palm oil is traded in the
name of soybean or vegetable oil.
Chocolate and ice cream industries are
the consumers of palm kernel oil while
soap industries use palm kernel oil, palm
stearin and palm fatty acid/acid oil.
Prospects for Palm Oil
Palm oil is the highest imported and
consumed edible oil in the country, being
imported steadily until 2003, when its
import volume exceeded that of soybean
oil. Before 2003, soybean oil had been the
leading edible oil for three decades in
Bangladesh. Palm oil now commands
about 70% of the market share among the
three major edible oils consumed locally.
The competitive price of palm oil has
made it the preferred edible oil in rural
areas, where 80% of the population lives.
Population growth is one of the driving
factors for the increasing palm oil
consumption. As the majority of the
people live in rural areas, their population
growth will be the major contributor to
increased palm oil consumption.
The economic well-being of the people is
another driving factor. With the increase
in the prices of agricultural commodities,
the purchasing power of the rural people
is increasing. Simultaneously their food
habits also change towards foods
requiring edible oil in their preparation.
This too contributes to the increase in per
capita consumption of oils and fats in
rural areas. These two factors will
increase per capita consumption of edible

Table 4: Present Import Duty Structure (Effective July 1, 2012)

Commodity

Import Duty Value Added Tax (VAT)

CPO, CPL, RBD PO and RBD PL in bulk

CDSBO
Oil Seeds
Refined Olein, Soyabean oil and
Sunflower seed oil in Consumer Packs

0
0
0

10%
10%
0%

15%

Table 5: Import Sources of Palm Oil: 2008-12

Year

MPO
Qty
Share
(Tonnes) (%)

2012
2011
2010
2009
2008

269,661
139,815
165,750
159,165
247,328

26
15
18
16
30

IPO
Others
Total
Qty
Share
Qty
Share
Qty
Share
(Tonnes) (%) (Tonnes) (%) (Tonnes)
(%)
757,533
799,443
764,397
862,463
554,514

74
84
82
84
68

Nil
9,817
Nil
1,500
14,063

1
2

1,027,194
949,075
930,147
1,023,128
815,955

100
100
100
100
100

Source: MPOC Market Intelligence

Table 6: Consumption of Oils and Fats vis--vis Population: 2007-12
Total Consumption of
Oils and Fats (MT)
Population (Million)
Per Capita Consumption (Kg)

2012

2011

2010

2009

2008

2007

1727
152.4
11.3

1598
150.5
10.6

1485
148.7
10.0

1419
147.0
9.7

1353
145.5
9.3

1400
144.0
9.7

Source: Oil World, December 2012

Import Sources of Palm Oil: 2008 - 2012
100
80
In (%)

Vanaspati and shortening are mainly

consumed in urban areas. Ghee and
butter oil are also popular among the
urban affluent consumers while liquid oil
is preferred by the general consumers,
both in urban areas and in rural areas,
due to its comparatively cheaper price.
Consumers in the rural areas and those in
the low-income group in the urban areas
buy loose oils while middle- and
upper-income groups prefer consumer
packs.

60
40
20
0

2008

2009

Malaysia

2010

2011

2012

Others

Indonesia

Total

Per Capita Consumption of Oils & Fats: 2007 - 2012

In Kgs

Continued from page 6

11.0
10.5
10.0
9.5
9.0
8.5

2007

2008

2009

2010

2011

2012

Oils & Fats

oils in the rural areas, where palm oil is
preferred.
Further,
keeping
in
pace
with
urbanisation and increased employment
in
the
industries
and
business
organisations, food habits of the middle
income groups in the urban areas are
also changing. They are now switching
processed foods, namely bread, cereals,
instant noodles and so on for breakfast

and lunch and for which the food

processing industries are expanding. All
such food industries consume palm oil or
palm-based vanaspati shortenings as a
major ingredient. These factors are
contributing, and will continue to
contribute, to higher consumption and
import of palm oil into Bangladesh.
Continued on page 11

MPOC FORTUNE 9

M ARK ET I ns
nsights

Palm Oils Strong Foothold in Bangladesh Market

Continued from page 9

Table 7: Consumption of the Three Major Edible Oils, 2007-12

2012

Total

2010

2009

2008

2007

Share
(%)
63
29
8

Qty
(MT)
996
406
118

Share
(%)
65
27
8

Qty
(MT)
945
328
143

Share
(%)
67
23
10

Qty
(MT)
847
396
108

Share
(%)
63
29
8

Qty
(MT)
936
243
105

Share
(%)
73
19
8

Qty
(MT)
779
452
102

Share
(%)
58
34
8

100

1520

100

1416

100

1351

100

1284

100

1333

100

1651

Source: Oil World, December 2012

Conclusion
In pace with the growth in population and
economic development, the consumption
vis--vis the import of oils and fats in the
country is on a rising trend. Among the
three major edible oils consumed in the
country, palm oil is the leading edible oil.
Its import volume is now around one
million MT, which is likely to increase to
1.4 million tonnes by 2017. The import
share of MPO has improved a lot in 2012.
As the people of Bangladesh have a good
notion about Malaysia and Malaysian
products, edible oils branded as
Malaysia, will have a bright opportunity in
Bangladesh. The active presence of MPO
suppliers, direct interactions between
MPO suppliers and local palm oil
importers and refiners and advantageous
terms and conditions for MPO supply to
the local importers will contribute to MPO
regaining its leading position in the
Fakhrul Alam, MPOC
Bangladeshi market.
Bangladesh

Table 8: Population Projection, Total Imports of Oils & Fats vis--vis Import of Palm
Oil, 2013-17
Year

Population @
1.34% growth
(in 000)

Total Import
of Oils & Fats
(in 000 MT)

2013

153,631

1,715

1,171

68.30

2014

155,689

1,810

1,237

68.35

2015

157,775

1,909

1,308

68.50

2016

159,889

2,014

1,384

68.70

2017

162,031

2,125

1,461

68.75

Consumption Trend of Major Three Edible Oils vis--vis

Total Consumption of Oils & Fats: 2007-2012
1,800
1,600
1,400
1,200
1,000
800
600
400
200
0

2007

2008

Palm Oil

MAR K ET I ns
nsights

Import of CPO,
Share of Palm Oil
CPL & RBD PO/PL in Total Import of
(in 000MT)
Oils & Fats (in %)

Source: MPOC Market Intelligence

Quantity in (000) tonnes

Qty
(MT)
Palm Oil
1030
Soyabean Oil
484
Canola/Mustard Oil 137

2011

2009

2010

Soyebean Oil

2011

2012

Rape/Mustard Oil

Total

Logistics - Challenge to Oils and Fats

Imports into Russia

Continued from page 7

Under the terms of the World Trade

Organisation (WTO), this will be much
more
promising
for
Malaysian
manufacturers.

finished products may be located out of

the port area, the terminal for handling
and transshipment of oils should be
within the port.

Under the WTO, Malaysian companies

will be able to better compete with the
local companies. This opens up
additional, interesting perspectives. The
heavy import duty, at 0.4 euro/kg for
packed products, has been lifted. The
current level of 5%, but not less than 0.12
euro/kg) is not final. Under the WTO
agreement, it will drop to 4% next year,
and then to 3%.

And if we arm a local company with

financial instruments, such as payment
delays and other privileges that attract
buyers, the company will definitely enjoy
a success in the Russian market. The
experience gathered by MPOC Russia,
along with good relations established on
the market during years of work, will work
for the success of the determined players
who are ready to come to Russia.

Summing up all that has been said, it is

necessary to own a constant stock of oil
in Russia in one of the ports of the Black
Sea or the Baltic Sea. Also, it is
reasonable to organise a warehouse for
receiving
and
storing
finished
products.While the warehouse for

Aleksey Udovenko, MPOC Russia

Ports Which Can Be Exploited For

Palm Oil Transshipment
There are two options of transshipment: 1
Option when bulking facility is used; 2
Option direct transshipment [from
vessel
to
rail
tanks].
Direct

transshipment, one way or the other, may

be applicable in all sea ports of Russia.

Port of Kaliningrad [berth #6]

Option 1 Bulking facility is used
Operator: Sodrugestvo
Company: Corporation Soyuz
Company Sodrugestvo is using facility for
Soy oil transshipment and palm oil
transshipment for the needs of
Corporation Soyuz
Continued on page 12

MPOC FORTUNE 11

MARK ET I ns
nsights
Continued from page 11

Logistics - Challenge
to Oils and Fats
Imports into Russia

MPOC
Offices
Worldwide
Malaysian Palm Oil Council (MPOC)
2nd Floor Wisma Sawit
Lot 6, SS 6, Jalan Perbandaran
47301 Kelana Jaya, Selangor
Tel:
603-7806 4097
Fax:
603-7806 2272
www.mpoc.org.my

Sea Port of Odessa

Max Draft 13 m
Bulking capacity 45 000 cub. m
Option 1 Bulking facility is used
Operator: Odessa Port Production and
Transshipment Complex [OPPTC]
Company: Cargill
Company OPPTC is using facility for the
export of Sunflower oil and for the import
of palm oil for the needs of Cargill and for
some minor clients.

Sea Port of Taman

Max Draft 9 m
Berth length 225 m
Bulking capacity 60 000 MT
Option 1 Bulking facility is used
Operator: EFKO
Company EFKO is using facility for the
export of Sunflower oil and for the import
of palm oil for own needs and distribution.

Sea Port of Ilyichevsk

Max Draft 14 m
Bulking capacity 1 90 000 cub. m
Bulking capacity 2 36 000 cub. m
1 Option Bulking facility is used
Operator: Risoil S.A [90 000]
Operator: Ilyichevsk Oils and Fats
Industrial Complex [IOFIC- 36 000]
Companies: Pacific Interlink, East Oil
Pacific Interlink is one of the biggest
importers of Palm oil in Ukraine.
East Oil company is a part of group which
owns IOFIC.

Sea Port of Yuzhniy

Max Draft 15 m
Bulking capacity 100 000 MT
1 Option Bulking facility is used
Operator: Wilmar
Wilmar is using facility for the export of
Sunflower oil and for the import of palm
oil for the own needs and distribution.

American Palm Oil Council

1010 Wisconsin Av, Suite 307
Washington DC 20007
Tel:
+1 (202) 333 0661
Fax:
+1 (202) 333 0331
www.americanpalmoil.com
E-mail: kassim@americanpalmoil.com
Contact: Mohd Salleh Kassim
MPOC Africa Regional Office
5 Nollsworth Crescent, Nollsworth Park
La Lucia Ridge Office Estate,
La Lucia 4051, KwaZulu-Natal, South Africa
Tel:
+27 (31) 5666 171
Fax:
+27 (31) 5666 170
E-mail: kazmi@mpoc.org.za
Postal Address:
P.O.Box 1591
M.E.C.C. 4301, South Africa
Contact: Kamal Azmi
MPOC Bangladesh
62-63 Motijheel Commercial Area,
7th Floor, Amin Court Building,
Dhaka, Bangladesh
Tel:
+88 (02) 9571 216
Fax:
+88 (02) 9551 836
E-mail: fakhrul@mpoc.org.bd
Contact: Fakhrul Alam
MPOC Shanghai
Shanghai Westgate Mall Co. Ltd.
Room 1610B, 1038 Nanjing Rd. (w)
Shanghai 200041, P. R. China
Tel:
+86 (21) 6218 2085 / 6218 2513
Fax:
+86 (21) 6218 1125
E-mail: teah@mpoc.org.cn
Contact: Teah Yau Kun
MPOC Pakistan
11 3rd Floor, Leeds Centre
Main Boulevard Gulberg, 111 Lahore, Pakistan
Tel:
+92 (42) 3571 6600 / 3571 6601
Fax:
+92 (42) 3571 6602
E-mail: faisal@mpoc.org.pk
Contact: Faisal Iqbal
MPOC India
S-4, New Mahavir Building, Cumballa Hill Road
Kemps Corner, Mumbai 400 036
Tel:
+91 (22) 6655 0755 / 6655 0756
Fax:
+91 (22) 6655 0757
E-mail: bhavna@mpoc.org.in
Contact: Bhavna Shah
MPOC Europe Regional Office
31 Avenue Emile Vendervelde
1200 Brussels Belgium
Tel:
+32 (2) 7748 860
Fax:
+32 (2) 7794 371
E-mail: kumar@mp oc.eu
Contact: Uthaya Kumar
MPOC Moscow
Moscow, 4th Dobrininskiy side-street,
8 BC 'Dobrinya', 1st floor, Office R00-126
Tel :
+790 963 520 40
Email: udovenko@mpoc.org.my
Contact: Aleksey Udovenko
MPOC Cairo
3 Gamal E1-Din Afify Street, Nasir City
Zone No.6, 11371 Cairo, Egypt
Tel:
+20 (2) 2273 8108
Fax
+20 (2) 2273 8106
E-mail: zainuddin@mpocegypt.com
Contact: Zainuddin Hassan

Publisher:

Malaysian Palm Oil Council (MPOC)

2nd Floor Wisma Sawit, Lot 6, SS 6,
Jalan Perbandaran, 47301 Kelana Jaya, Selangor

Printed by: Aktiara Corporation Sdn Bhd

1 & 3, Jalan TPP 1/3, Taman Industri Puchong
Batu 12, 47160 Puchong, Selangor

MPOC Istanbul
Guzel Konutlar Sitesi
Dilek Apartment Daire 3
Balmumcu, Besiktas - Istanbul, Turkey
Tel:
+90 (212) 2668234
Fax
+90 (212) 2668236
E-mail: haznita@mpoc.org.my
Contact: Norhaznita Husin