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Pakistan’s political unrest might seem endless and its security situation may be deteriorating but it still remains one of the biggest consumer markets in the world. With an estimated population of 188 million, Pakistan is the 6th most populous country at the moment and according to World Population Data sheet, Pakistan’s population will reach approximately 363 million in 2050. Consumer spending in Pakistan has registered an increase of approximately 26% in the past 3 years and it is mainly because of the increased awareness, rapid urbanization, growing middle class and penetration of leading international brands.
The chart below indicates that the real per capita income of a general consumer in Pakistan has increased steadily in the last ten years and currently stands at USD 1,386/-. This steady increase coupled with the increasing trend of women working, has led to a rise in household income of an average family. According to estimates, a normal consumer in Pakistan spends approximately 42% of his/her income on food and food related items. This trend of spending on food items is also corroborated with the increase in the imports and consumption of oils and fats in Pakistan.
Following chart shows the trend of edible oil imports in Pakistan.
The imports of oils and fats in Pakistan have registered an average increase of 7.5% per year in the last 06 years which is in proportion with the increase in per capita income and overall increase in
MPOC FORTUNE
MALAYSIAN PALM OIL COUNCIL KKDN PP 14669/05/2013 (032704) VOL: 8 2014
®
DIRECTOR
Faudzy Asrafudeen Sayed Mohamed [email protected]
MANAGERS
Muhammad Kharibi Zainal Ariffin [email protected]
Mohd Izham Hassan [email protected]
MARKET ANALYSTS
Asia Pacific Lim Teck Chaii (China) [email protected]
Asia Pacific Mohd Hafezh Bin Abdul Rahman (Excl. China) [email protected]
South Asia Fatimah Zaharah Md Nan [email protected]
Middle-East Mohamad Suhaili Hambali [email protected]
Africa Nor Iskahar Nordin [email protected]
Europe Azriyah Azian [email protected]
Americas Mohd Izham Hassan [email protected]
MARKETING & MARKET DEVELOPMENT DIVISION
For more information, please contact Tel : 603 - 7806 4097 Fax: 603 - 7806 2272
Continued on page 10
836
2005
1,600
1,400
1,200
1,000
800
600
400
200
02006 2007 2008 2009 2010 2011 2012 2013 2014
9261,085 1,042 1,046 1,072
1,2751,323 1,368 1,386
$
Source: Economic Survey of Pakistan
Per Capita Income 2005 - 2014
Commodity Imports MT
2008 2009 2010 2011 2012 2013
CPO 546,195 453,926 491,899 749,000 428,353 278,118
Palm Oil 343,920 733,085 184,202 263,444 749,513 998,619
Palm Olein 641,260 556,214 1,211,368 970,746 752,603 979,308
Palm Fats 39,652 93,851 62,889 65,260 69,652 71,893
Soybean Oil 20,969 48,596 55,762 51,200 40,500 30,664
Tallow 39,098 29,720 52,133 25,178 32,591 15,264
Total Oils & Fats 1,631,094 1,915,392 2,058,253 2,124,828 2,073,212 2,373,866
Source: Shipping Agents’ Vessel Reports
Palm Oil and Pakistan’s ResilientConsumer Market
MPOC FORTUNE • 3
MARKETInsightsIns g
Import Tariff of Oils and Fats In Nepal there are two tiers of import tariffs, one is applicable for the member countries of the South Asian Association for Regional Co-operation (SAARC) and the other one is for rest of the countries of the world. Member countries of SAARC are Bangladesh, Bhutan, India, Nepal, Maldives, Pakistan and Sri Lanka. Import tariff on some of the selected commodities of oils and fats are furnished below.
Local Refining IndustriesEdible oil refining industries in Nepal grew primarily based on the opportunity of export of vanaspati to India under a bilateral agreement signed between Nepal and India in 1996, which was later revised in 2002. Under the agreement, Nepal can export vanaspati to India at a reduced tariff and accordingly, almost all the 18 edible oil refineries were set up near the towns at the Nepal-India border, such as Birat Nagar and Birgonj. With the loss of this opportunity of export of vanaspati to India in 2008-2009 fiscal year, all these refineries are running under capacity and catering only to local demand. At present, 16 refineries and nine of these vanaspati producing companies are still in operation.
Out of three solvent extraction plants that were set-up in 2009-10 to produce soybean meal and crude soybean oil from imported soybean, only two are in operation because of limited demand for soybean meal.
Continued on page 6
Part 2 of 2Oils & Fats in Nepal - An Update
Present Import Tariff for Selected Oils and Fats:
Commodity Import Tariff (%) Remarks Except otherwise specified
General SAARC
Soybean /Rape 10 10 7% import tariff is applicable/Mustard/ for import of copra if importedSunflower seed/ from SAARC country’sSesame/ Linseed/Copra
Soybean oil andSunflower Oil
- Crude 5 5
- Refined 10 10
Palm oil/Olein- Crude 5 5
- Refined 10 10
Rape/Mustard Oil/Canola Crude/Refined 10 10
Coconut oil
- Crude 10 7
- Refined 15 9.25
Tallow/Animal Fats 5 5
PKO
- Crude 5 5
- Refined 10 10
Margarine/ Hy. 15 15
Vegetable Fats
PFAD/Acid Oil/ 5 5Fatty Acids
Source: Customs Tariff of Nepal: 2011-12, Department of Customs, Ministry of Finance, Govt. of Nepal
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
Jalan Parang, 2nd Extension, North Port, 42000 Port Klang, Selangor, MALAYSIATel: +603 - 3176 7211 Fax: +603 - 3176 5641 Email: [email protected]
http://www.fimabulking.com
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.
Malaysia’s Largest Independent Common-user Multi-purpose Liquid
Bulk Terminal Operator
MPOC FORTUNE • 5
MARKETInsightsIns g
Continued on page 7
During the 2014 pro-Russian unrest in Ukraine, a number of governments applied sanctions against individuals and businesses from Russia and Ukraine. Sanctions were approved by the United States, the European Union (EU) and other countries and international organisations. Russia has responded with sanctions against a number of countries, including a total ban on food imports from the EU, United States, Norway, Canada and Australia.
When Russia announced a complete ban on a number of categories of food and agriculture products from the EU, US and few other countries in August this year, the market began to speculate the impact on its domestic food market. The embargo comes in response to the penalties imposed on Russia over the crisis in Ukraine. The ban is intended for one year, with a condition to revise the duration if the countries affected demonstrate positive approach on cooperation. Russia is convinced that
they were coerced into resorting to this measure, but either way the government is certain that they will be able to turn things to the country’s benefit.
It is believed that the import ban will not result in a food shortage in Russia and its short term impact is likely to be moderate. However, analysts believe that the ban will likely to drive up domestic food prices, which has already picked up after the devaluation of Russian Rouble during the first half of 2014. One of the sectors that can have major impact is the food processing industry. The majority of raw materials and ingredients used by Russian food processors and manufacturers are imported. This leaves ample prospects for exports to Russia as the decline in imports from the EU and the US needs to be substituted gradually by higher imports from other countries.
The EU and USA is particular are very important trade partners for Russia as far as food industry are concerned. Russia imported about USD1.54 billion of food and agriculture products from the US in 2013. Total imports from the EU amounted to USD13.7 billion which includes among others products such as
Russia’s Ban onWestern FoodImports: AnOpportunity For Palm Oil
BelarusBrazil
UkraineGermany
TurkeyChina
PolandUSA
FranceNetherlands
ItalySpain
Others EU…
2.742.41
1.991.83
1.681.61
1.551.54
1.421.42
1.341.26
4.88
Source: International Trade Centre & Reuters
Chart 1: Food Exports to Russia - Top Suppliers (USD Billion)
6 • MPOC FORTUNE
Table 6: Palm olein bards and respective producers:
Brand Producer
Sangam Swastik oil industries pvt. Ltd.
Baba olein Baba vegetable industries pvt. Ltd.
Pashupati olein Pashupati khadya tel udyog pvt. Ltd.
Kusum Kusum oil industries pvt. Ltd.
Nandan Nandan ghee and oil industries
Safari Ganpati vanaspati limited
Amrit Annapurna veg prod. Pvt. Ltd
Neel kamal, mangalam Narayani oil refinery
Shakti Shree shiv shakti ghee udyog
There are now 10 locally produced palm olein brands in the market. Due to weather conditions, palm olein brands are marketed only during the April to September period. The total market size for the branded olein now is around 8,000 MT annually. Pack sizes range from half-litre pouch packs to 20-litre jerry cans. Some quantities of refined olein also sold in loose form. Palm olein brands are marketed mainly at rural consumers because of its price competiveness compared with other edible oils.
Palm Oil Imports The import of palm oil in Nepal began in 1983 with an import volume of 1,510 MT. The import volume reached its peak in 2003 when 188,056 MT of palm oil were imported. Being the most suitable raw material for vanaspati production, the import of palm oil in Nepal grew rapidly with the increase in vanaspati production based on the opportunity to export it to India at a reduced tariff under the India-Nepal Trade Treaty, which was revised in 2002 and limited the export of vanaspati from Nepal to India at 100,000
MT annually to safeguard the Indian vanaspati industry.
Furthermore, India reduced the import duty on palm oil to zero, which caused the price competitiveness of Nepalese vanaspati against Indian vanaspati to drop drastically. With the eroding of export of Nepali vanaspati to India, palm oil import in Nepal also declined substantially since 2008 and it is now imported only to cater the local demand. However, in 2013 import of palm oil, crude and refined together, registered an increase of 30.18% compared with 2012.
Aside from this, crude/refined palm oil, a significant quantity of PFAD/Acid Oil are also imported each year. This is in addition to some quantities of palm-based vegetable fats and margarine which are also imported regularly but because of the insignificant quantities, these items have little impact on total import of oils and fats. Apart from vanaspati industries, local noodles, biscuit and bakery and soap Industries are the other major consumers of palm oil and palm oil products.
Import of Malaysian Palm Oil and Palm Oil Products In 2013, import of crude and refined palm oil from Malaysia were not very significant as import of palm oil, crude and refined together from Malaysia was only 3,431 MT, which is about 6.6% of the total palm oil imported in Nepal.
Table 7: Import of Palm Oil in Nepal - 2010-2013 (in MT)
Commodity 2010 2011 2012 2013
Crude Palm Oil 56,520 46,616 36,245 46,674
Refined Palm Oil/Olein 13,803 2,633 3,772 5,403
Source: Export Import Data Bank, Trade and Export Promotion Centre,Ministry of Commerce and Supplies, Govt. of Nepal
MARKETInsightsIns gContinued from page 3
Continued on page 12
Oils & Fats in Nepal - An Update
MPOC FORTUNE • 7
Russia’s Ban on Western Food Imports:An Opportunity For Palm Oil
Source: USDA
1.7
2.015%
2.010%
2.15%
2.315%
2.310%
2.610%
3.415%3.0
15%
3.915%
2006
Con
sum
ptio
n (U
SD
Bill
ion)
2007 2008 2009 2010 2011 2012 2013 2014 2015
Chart 2: Consumptionof Russian Food Ingredients Market and Rate of Growth
cheese and curd, fresh, chilled and frozen swine meat, food preparations, chocolate and others with cocoa, pig and poultry fat as well as malt extract (flour, meal, starch).
Impact of the Ban on Russia’s Food Processing SectorPoised for a rapid growth and set to become one of the highest yielding sectors in the country, the food
processing industry continues to grow impressively. According to Euromonitor, the Russian processed food market experienced an encouraging growth of 4% in volume terms and reached 967 billion Rubles (USD24.18 billion) in 2012. Rising disposable income, increasing real wages, declining unemployment and growing food expenditure are believed to have attributed to this growth. However, with this ban, Russian food processing
companies are most likely to be affected as long as they rely on imported ingredients on the sanctions list.
Russia is the largest processed food market in Europe and one of the world’s largest importers of food processing ingredients. Its population of 146 million further develop the food processing industry as highly attractive. In other words, the ban somehow opens the door for trade collaborations with other countries and helps Russia accelerate closer trade ties with non-Western nations. It is reported that Russian officials have already spoken to alternative suppliers outside the list of targeted countries. Prime Minister, Mr. Dmitry Medvedev was quoted as saying “Our trade partners from other countries remain with us”. At present, over 20 types and 1,000 varieties of food ingredients and additives are used in the Russian food processing market. According to the Union of Food Ingredients of Russia, the products include sweeteners, emulsifiers, preservatives, fats, stabilisers, starches and thickeners, among others. Bakery,
MARKETInsightsIns g
Continued from page 5
Table 1: Ingredients Used in Russia’s Food Processing Sectors
Food Processing Sector Food Ingredients and Additives (%)
Confectionary 56.6
Bakery 38.4
Dairy, Butter & Cheese 33.0
Soft Beverages 25.2
Fats & Mayonnaise 24.1
Meat Processing 23.0
Ice cream 19.1
Fruits jams 18.0
Snack & chips 16.6
Vegetables & sauces 16.4
Fish processing 14.3
Others 8.9
Source: USDAContinued on page 11
Veteran of the agro-commodity industry with over 50 years professional experience in the executive management of business operations within the plantation tree crop commodity sector. Having served for 35 years, he retired as Director and Head of Plantations of Franco-Belgian multi-national, SOCFIN Company Ltd in 1996.
He was the start-up Chief Executive of the Malaysian Palm Oil Association(MPOA) and served this umbrella entity tasked with the function of balancing the needs and interests of the various sectors for synergy and development of the Malaysian plantation industry, from 1999 to 2005.
He was involved in the formation of Roundtable on Sustainable Palm Oil (RSPO) in 2003 with the objective of promoting the growth and use of sustainable palm products through credible global standards & engagement of stakeholders. Appointed as the Chairman of the first RSPO meeting in 2003, elected as a Vice-President during 2004/2005 term and currently the Advisor to RSPO.
Over the years he has held responsible positions in the agro- commodity sector and continues to serve the industry as company director/commissioner, and also in an advisory and consultancy capacity to various business ventures and trade associations, at both regional and international level.
He is a University of Adelaide graduate in Agricultural Economics (B.Sc Tech)) and has been honoured with the Fellowship awards of the
Incorporated Society of Planters (FISP), the Malaysian Oil Scientists' & Technologists’ Association (FMOSTA), the British Institute of
Management (FBIM), The Malaysian Institute of Management (FMIM) and Honorary Membership of RSPO.
Palm Oil: Navigating through Global Challenges
2.00 pm - 6.00 pmGrand Dorsett SubangSubang Jaya, Selangor, Malaysia
2014October
31st
FRIDAY
Mr. M. R. Chandran, Platinum Nanochem Sdn. Bhd
Analysis of Malaysian Palm Oilin 2015 – Production, Stock & Prices
En. Ramli Abdullah,MPOB
Managing Palm Oil Price Risk
Mr. Ryan Long, FCStone Asia Pte. Ltd.
En. Ramli Abdullah was formerly a Statistical Officer at the Department of Statistics Malaysia and Kuala Lumpur City Hall. He was a Researcher at PORIM / MPOB and a Principal Research Officer at MPOB, heading the Techno-Economic Research Unit of MPOB. He is currently the Director of the Economic and Industry Development Division of MPOB. He had written a number of papers and made presentations at local conferences, such as Kuala Lumpur Commodities Exchange (KLCE) Workshops, Palm Oil Congress (POC), PORIM International Palm Oil Congress or PIPOC Conferences and MPOB Economic Review and Outlook Seminar. At the international level, his presentations included those at the International Oils and Oilseeds Conference (IOOC), China and technical seminars in Karachi, Pakistan, and in Dhaka, Bangladesh.
He holds a Diploma in Statistics, Bachelor of Science degree in Business Administration majoring in Computer Information System from Drake University, Iowa, United States of America and a Masters of Arts degree in Computer Science from Springfield State University, Illinois, United States of America.
Mr. Ryan Long has 15 years of hands-on work experience in the palm oil industry. He graduated with an honors degree in International Business from Northumbria University, U.K. He started his career in the industry as a physical broker with an established brokerage firm in Kuala Lumpur. His curiosity and interest in financial aspect of the palm oil market led him to become a licensed futures broker’s representative
with a regional investment bank head-quartered in Kuala Lumpur. He was last attached to the palm oil corporate dealing team of RHB Investment Bank before his move to Singapore to set up a new palm oil desk for FCStone Asia Pte Ltd. INTL FCStone Inc. is a NASDAQ listed Fortune 500 financial services firm specializing in commodity risk management.
Programme2.00 pm Registration / Networking Refreshment
2.30 pm Welcome Remarks by En. Wan Mohd Zain Wan Ismail, PORAM Chairman
SESSION I
2.45 pm Presentation 1 “Palm Oil: Navigating Through Global Challanges” by Mr. MR Chandran, Platinum Nanochem Sdn. Bhd
3.30 pm Presentation 2 “Analysis of Malaysian Palm Oil in 2015 -
Production, Stock & Prices” by En. Ramli Abdullah, MPOB
4.15 pm Questions & Answers
4.30 pm Networking Refreshment
SESSION II
4.50 pm Presentation 3 “Managing Palm Oil Price Risk” by Mr. Ryan Long, FCStone Asia Pte. Ltd.
5.30 pm Presentation 4 “Exim Bank - Expanding Frontiers” by Mr. Chairil Mohd Tamil, Exim Bank
6.10 pm Questions & Answers
6.30 pm Closing Remarks / Networking Refreshment
En. Chairil Mohd Tamil,Exim Bank
• Deputy President / Chief Business Officer
• Graduated from the University of Bristol (UK).
• 22 years experience in investment banking and consultancy works.
• Started banking career with several investment banks namely, AmInvestment, Affin Investment and CIMB Investment.
• Former Director of Investment Banking, a local Islamic Bank and an independent advisory company.
• Joined EXIM Bank in 2011 as the Head of Strategic Project Finance and was later promoted to be the Head of Banking in early 2013. Effective from 6 Feb 2014, appointed as Chief Business Officer of EXIM Bank.
• Extensive experience in fund raising with completed bond/sukuk issuances and loan syndications exceeding RM50 billion.
Exim Bank: Expanding Frontiers
PaymentPayment is required with your registration form. Confirmation will only be issued upon receipt of full payment. Fees include Forum fee, documentation & refreshment.
Registration FeeMembership Registration Before Registration AfterCategory 15th October 2014 15th October 2014
PORAM Members RM 300.00 per person/ RM 350.00 per person/ USD 120.00 per person USD 140.00 per person
Non-PORAM RM 350.00 per person/ RM 400.00 per person/Members USD 140.00 per person USD 160.00 per person
Walk In (Cash only) RM 450.00 per person/USD 180.00 per person
Bank transfer, copy of bank-in slip must be faxed / mailed over as proof of bank remittance:
CIMB Bank Bhd Account No: 8000212109 Main Branch: No 11, Jalan Raja Laut 50350 Kuala Lumpur, Malaysia.
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Cheque or Bank Draft, made payable to “The Palm Oil Refiners Association of Malaysia”. Please indicate participant(s) name(s) and ref: PAF2014 on back of cheque / bank draft.
Cheque / bank draft no:
Amount:
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Selangor 3, Grand BallroomGrand Dorsett Subang, Subang JayaSelangor Darul Ehsan, Malaysia
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MAIL FORM to: PORAM, 801C / 802A, Block B, Executives Suites, Kelana Business Centre, 97 Jalan SS7/2, 47301 Kelana Jaya, Selangor, Malaysia.
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The Palm Oil Refiners Association of Malaysia801C / 802A, 8th Floor, Block B
Executive Suites, Kelana Business Centre97, Jalan SS7/2, 47301 Kelana Jaya, Selangor, Malaysia
Tel: 603-7492 0006 Fax: 603-7492 0128E-Mail: [email protected]/[email protected]
Forum Sponsorship Form
2014October31st
Selangor 3, Grand ro mmGrand Dorsett Sub , Subang JaySelangor Darul Eh laysia
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welcoming speech • Free table top to showcase products or services of your company • Option of distributing corporate information/gifts to participants • Website link in PORAM’s website
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Forum Bag RM8,000
• Display of Company name and Corporate logo on the Forum backdrop • 4 complimentary invitations to the Forum • 2 complimentary invitations to the PORAM Annual Dinner 2014 • Free table top to showcase products or services of your company • Exclusive company name and logo on each bag • Option of distributing corporate information/gifts to participants
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Year to Date Import of 2014
Commodity Year-to-Date Changes Jan - Sep 2013 Jan - Sep 2014 Vol. %
Crude Palm Oil 247,418 69,491 (177,927) (71.91)
RBD Palm Oil 669,522 877,186 207,664 31.02
RBD Palm Olein 684,604 751,547 66,943 9.78
Palm Fats 58,094 61,959 3,865 6.65
Soybean oil 30,664 98,249 67,585 220.41
Tallow 9,175 8,000 (1,176) (12.81)
Total 1,699,477 1,866,432 166,955 9.82
Source: Shipping Agents’ Vessel Reports
consumer spending in Pakistan. The Pakistani edible oil industry relies heavily on imports to meet their demand and palm oil continues to be the preferred feedstock for a wide range of industries.
Edible oil imports had a slow start in the first quarter of 2014 which is generally a high import volume period. At the end of March 2014, the oils and fats imports were trailing by 32% and this decline was mainly due to higher stocks and lack of buyers’ confidence on international prices.
The imports started picking up in the second quarter of the year and reached 1.235 million MT at the end of June 2014, which was 10% higher than the same period last year. The recovery in the second quarter was significant and was mainly because of the increased buying for the festive month. At the end of September 2014, imports had reached 1.866 million MT.
It can be noticed from the year to date import figures of oils and fats that the market is dominated by RBD palm oil and RBD palm olein with a share of 47% and 40% respecttivly in total imports. CPO
which was once a leading import commodity has registered a decline of 71% as compared to the same period last year. Soybean oil has also registered a sharp increase in the imports which was mainly due to the temporary shortage of canola and sunflower in Pakistan in the first two quarters.
Although the edible oil industry in Pakistan imports all three fractions of palm oil, RBD palm olein and CPO have been the highest imported fractions for
the last few years and this is mainly due to the subsidized import duty applied on these two fractions. However, the import scenario started shifting from 2012 after the export duty adjustment in Indonesia which shifted the buyers’ preference from CPO to RBD palm oil. The chart below shows a 4 year analysis of the imports of CPO, RBD palm oil and RBD palm olein in first three quarters.
It can be seen that RBD palm oil has replaced the imports of CPO despite of the fact that RBD palm oil is subjected to
a USD 23/- higher duty as compared to CPO. The price discounts offered by Indonesian suppliers on RBD palm oil made the local refining of CPO economically infeasible which has also resulted in the closure of 90% of the physical refining industry in Pakistan.
Pakistan being a net importer of edible oils will always remain a dependable export destination and this has been proven by a consistent and steady
Palm Oil and Pakistan’s ResilientConsumer Market
MARKETInsightsIns g
Continued from page 1
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
MTJan-Sep
2011
Jan-Sep
2012
Jan-Sep
2013
Jan-Sep
2014
CPO
Palm Oil
Palm Olein
Continued on page 11
10 • MPOC FORTUNE
MPOC FORTUNE • 11
Russia’s Ban on Western Food Imports:An Opportunity For Palm Oil
MARKETInsightsIns gContinued from page 7
confectionery, dairy and ice cream manufacturing, meat processors as well as canned and bottled food producers are the main users of these products. Control of the products’ texture, prolonged shelf life and more appealing and tasty products are some of the reasons why the ingredients and additives are preferred among the domestic food processors in the country. In 2013, demand for food ingredients by the processing industry was valued at USD3 billion and it is estimated to increase to USD3.9 billion in 2015.
The ban on the food imports is rather unfortunate as Russian food processing sector in general is dependent on imported food ingredients and additives. Domestic issues such as access to raw materials and inefficient supply chain only add to the challenges faced by the domestic food producers. It is reported that Russia consumes about 8-10% of the world’s market for ingredients. Most of food ingredients and additives that are used, which is estimated at 86% are made from imported raw materials with China being the major supplier of ingredients to Russia. This is a testament that apart from being a massive market,
this sector also offers significant room for a growing export opportunity.
Challenges and Opportunities for Malaysian Palm Oil ExportersCompetition in the industry is also rising with the establishment of multinational companies such as Cargill, Kraft and Symrise. Demand for food processing ingredients is increasing significantly compared to the other sectors. At the same time, the market is widening its assortment and range of ingredients, dishes and preparation styles. Imported ingredients often meet the international quality standards over local ingredients, which explain why this sector depends heavily on imports. As food processing companies in Russia continue to expand and modernise their production facilities, the demand for high quality too increases. Its Government is reportedly committed to develop the country’s infrastructure over the next 10 years, particularly railroads and highways, translating to better logistics in the near future.
Russia’s accession to WTO in August 2012 sees its trade and investment policy meeting the international guidelines and standards. Import duties vary between
5-30% and are applicable to many food products. As part of its WTO agreement, Russia has committed to reducing and binding import tariffs on all agricultural goods, thereby providing more clarity on its duties. All products exported to the Russian Federation must include relevant information in local language as part of its labelling requirements.
Distribution, market access, marketing, pricing, packaging and branding are all important aspects in expanding businesses in Russia. MPOC Regional Office in Moscow has actively participated in major trade shows, namely Prodexpo International Exhibition (February), Ingredients Russia (March) and World Food Moscow (September). Participation at these events is the ideal avenue to introduce new products and enables exporters to conduct initial market research. MPOC offers assistance for those Malaysian palm oil exporters who are interested to visit and participate at these events. As the saying goes, “one man’s loss is another man’s gain” and this could be the perfect time for Malaysian palm oil to expand its market in particular the Russian food processing sector. Azriyah, MPOC HQ
Palm Oil and Pakistan’s ResilientConsumer Market
MARKETInsightsIns gContinued from page 10
increase in the imports of oils and fats. Despite the volatile market conditions this year, the imports of oils and fats are registering an increase of 10% as compared to last year and it is anticipated that the volumes will exceed 2.250 million MT at the end of December 2014.
Although the increased imports and consumption of oils and fats in Pakistan is a welcome sign for the industry, however, the share of Malaysian palm oil
in Pakistan is being gradually eroded by Indonesian suppliers. Pakistan signed the Preferential Trade Agreement with Indonesia in September 2013 which has brought both Malaysia and Indonesia at par. This level playing field coupled with the incentive on the export of refined oil has given Indonesian exporters a fairly big advantage over Malaysian suppliers.
Malaysian palm oil has been an integral part of the oils and fats industry of
Pakistan for over 4 decades and stakeholders at both ends enjoy a strong and longstanding relationship. Malaysian companies have also invested in various edible oil joint venture projects in Karachi which also gives them an advantage of local presence. In order to regain the dominance in Pakistani market, Malaysian industry will have to become aggressive and take advantage of low international prices. Faisal, MPOC Pakistan
MPOCOffices
WorldwideMalaysian Palm Oil Council (MPOC)2nd Floor Wisma Sawit Lot 6, SS 6, Jalan Perbandaran47301 Kelana Jaya, SelangorTel: 603-7806 4097Fax: 603-7806 2272www.mpoc.org.my
American Palm Oil Council 1010 Wisconsin Av, Suite 307Washington DC 20007Tel: +1 (202) 333 0661Fax: +1 (202) 333 0331www.americanpalmoil.comE-mail: [email protected]: Haznita Hussin
MPOC Africa Regional Office5 Nollsworth Crescent, Nollsworth ParkLa Lucia Ridge Office Estate,La Lucia 4051, KwaZulu-Natal, South AfricaTel: +27 (31) 5666 171Fax: +27 (31) 5666 170E-mail: [email protected] Address:P.O.Box 1591M.E.C.C. 4301, South AfricaContact: Kamal Azmi
MPOC Bangladesh62-63 Motijheel Commercial Area,7th Floor, Amin Court Building,Dhaka, BangladeshTel: +88 (02) 9571 216Fax: +88 (02) 9551 836E-mail: [email protected]: Fakhrul Alam
MPOC ShanghaiShanghai Westgate Mall Co. Ltd.Room 1610B, 1038 Nanjing Rd. (w)Shanghai 200041, P. R. ChinaTel: +86 (21) 6218 2085 / 6218 2513Fax: +86 (21) 6218 1125E-mail: [email protected]: Desmond Ng
MPOC Pakistan11 – 3rd Floor, Leeds CentreMain Boulevard Gulberg, 111 Lahore, PakistanTel: +92 (42) 3571 6600 / 3571 6601Fax: +92 (42) 3571 6602E-mail: [email protected]: Faisal Iqbal
MPOC India S-4, New Mahavir Building, Cumballa Hill Road Kemps Corner, Mumbai 400 036Tel: +91 (22) 6655 0755 / 6655 0756Fax: +91 (22) 6655 0757E-mail: [email protected]: Bhavna Shah
MPOC Europe Regional Office31 Avenue Emile Vendervelde1200 Brussels BelgiumTel: +32 (2) 7748 860Fax: +32 (2) 7794 371E-mail: [email protected]: Uthaya Kumar
MPOC MoscowMoscow, 4th Dobrininskiy side-street,8 BC 'Dobrinya', 1st floor, Office R00-126Tel: +790 963 520 40Email: [email protected]: Aleksey Udovenko
MPOC Cairo3 Gamal E1-Din Afify Street, Nasir CityZone No.6, 11371 Cairo, EgyptTel: +20 (2) 2273 8108Fax +20 (2) 2273 8106E-mail: [email protected]: Zainuddin Hassan
MPOC IstanbulGuzel Konutlar SitesiDilek Apartment Daire 3Balmumcu, Besiktas - Istanbul, TurkeyTel: +90 (212) 2668234Fax +90 (212) 2668236E-mail: [email protected]: Muhamad Suhaili HambaliPublisher: 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
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MARKETInsightsIns gOils & Fats in Nepal - An Update
MARKETInsightsMARKETInsightsContinued from page 6
Table 8: Import of Selected Oils and Fats From Malaysia 2011-2013 (MT)
Commodities 2011 2012 2013
Crude Palm Oil 500 750 1,204
Refined Palm Oil/Olein 4,128 2,813 2,227
Refined Soyabean oil 428 431 273
Crude/Refined Coconut oil 551 647 428
Hy. Fat/Margarine 801 839 746
Other Oils and Fats 1,179 770 764
PFAD/Acid Oil 13,821 12,051 12,917
Total 21,408 18,301 18,559
Source: Export Import Data Bank, Trade and Export Promotion Centre, Ministry of Commerce and Supplies, Government of Nepal
PFAD/Acid Oil were also imported from Malaysia recorded at 18,559 MT, which was about 59.41% of total PFAD/Acid Oil imported in Nepal in 2013. Apart from these two commodities, some quantity of hydrogenated fats/margarine, refined soybean oil, crude/refined coconut oil and other oils and fats are also imported from Malaysia each year.
Conclusion Nepal is mainly dependent on import to meet its demand for oils and fats as local production is insufficient. Due to limited agricultural land, the possibility of a significant increased local production of oilseed crops is highly unlikely. While some increases in both area under
oilseed cultivation and production quantity of oilseeds have been observed during the last few years, this is still far from fulfilling local demands. On the other hand, consumption is increasing in pace with population increase, change of lifestyle and food habits caused by economic uplift and increase in the urban population. In fact, the total imports of oils and fats, including palm oil, registered a good increase in both 2012 and 2013. In view of this fact, besides palm oil, palm olein may be focused as a future strategy for the Nepali market and in line with this strategy the Malaysian palm oil industry could also plan some promotional activities. Fakhrul, MPOC
Bangladesh
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