Table 1: A Review on MPO Export Performance (MT)

Source: MPOB

During the review period from Jan-May 2023, MPO exports to the South Asian region was recorded at 1,362,235 MT, which was a decline of 197,175 MT or by 12.64% compared to the same period of 2022. This can be attributed mainly to lower imports by India which declined by 247,660 MT or by 20.26% compared to the same period of 2022. Despite the decline in MPO imports, India still retains the position as Malaysia’s main export destination in this region with a market share of 72%.

The main reasons for the decrease in MPO exports to this region are mainly due to Indonesia lifting their palm oil export ban in May 2023 as well as narrow price spread between palm oil and soft oils that led to higher demands of soft oils as can be seen in major markets such as India.

Table 2: MPO Exports to India by Type of Products (MT)

Source: MPOB

MPO exports to India during Jan-May 2023 decreased by 20.26% from 1,222,442 MT to 974,782 MT contributed by several factors such as high supply and cheaper availability of soft oils and easing of Indonesian export policy. During the first five months of 2023, palm oil imports from Indonesia and Thailand has increased by 40% and 58% respectively Y-o-Y reducing the imports from Malaysia.

Imports of soft oil increased by 12% Y-o-Y to 2.87 million MT in Jan-May 2023 compared to 2.56 MMT imported same period last year supported by huge sunflower oil imports. Cheaper availability of sunflower oil during the last few months has increased the imports during this period by 55% Y-o-Y to 1.31 million MT meanwhile imports of soybean oil decreased by 9% Y-o-Y to 1.56 million MT.

During the coming months, total vegetable oil imports by India are expected to be on the increasing trend owing to an increase in demand during the upcoming festival season. It is estimated that total vegetable oil imports to increase towards 1.15-1.2 million MT in June 2023.

Table 3: MPO Exports to Pakistan by Type of Products (MT)

Source: MPOB

MPO exports to Pakistan during Jan-May 2023 went down to 163,119 MT from 180,358 MT recorded during the same corresponding period of last year. The arrival of oils and fats in the country is still under pressure due to the continued financial crisis which is leading to delayed payments and slow processing of import documents. The expected import in the month of June is anticipated to be around 300,000 MT out of which approximately 270,000 MT is palm oil and rest is soybean oil.

Table 4: MPO Exports to Bangladesh by Type of Products (MT) 

Source: MPOB

MPO exports to Bangladesh increased during Jan-May 2023 period from 104,629 MT to 125,832 MT during the same corresponding period of last year. Higher palm oil intake is mainly due to the festive season in the country. It was reported that May 2023 stocks were 238% % higher than May 2022 and 19% higher than the previous month. Palm oil products’ stocks were lower by 22.94% compared to April 2023 while soft oils stocks were reportedly lower by 12.71%.

Table 5: Breakdown of MPO Exports (MT)

Source: MPOB

In terms of breakdown, the biggest product being exported to the region during Jan-May 2023 period is crude palm oil (CPO) accounting for 59% of overall palm oil imports followed by RBD palm olein (RBD PL) with 22%. These two palm oil products accounted for 81% of the total MPO exports to this region. Among the major importers of Malaysian CPO are India and Pakistan and major destinations for Malaysian RBD PL are India, Pakistan and Bangladesh. Cooking oil exports have also increased from 107,057 MT to 146,174 MT with major destinations include Pakistan and Afghanistan.

Chart 1: Breakdown of MPO Exports (MT): Jan-May 2023

Source: MPOB