AFRICA for a long time has been regarded by many as “a dark continent” with very little progress and little economic prospects. This perception is fast eroding, with the veil of secrecy and isolation lifted and foreign investors and traders being welcomed with open arms. Sub-Sahara represents a region that offers a huge land area, plenty of resources, competitive labour manpower and is not burdened with protective trade or restrictive environmental policies.

Sub-Saharan Africa covers 45 countries, with a population estimated at 680 million in 2009, and geographically divided into four sub-regions: Eastern Africa, Southern Africa, Western Africa and Central Africa. Traditional governments of despots and military regimes dominated the region in the past but with advancing communication, ease of travel and borderless information, in addition to higher expectations and demands of the populations, new democratic governments are emerging. A growing number of countries are now in a better economic position for international trade and the climate is very conducive for business.

Oils and Fats Scenario Over the years, Sub-Saharan oils and fats imports have increased from 2.4 million metric tonnes in 2003 to 3.6 million MT in 2008, with palm oil contributing to a major portion of that increase from, 1.5 million MT to 2.6 million MT during the corresponding period. In terms of percentage, palm oil accounts for about 70% of the total oils and fats imported. This phenomenal growth of palm oil can be attributed to several factors; among them its competitive price, increasing

population and economic growth of the region.

Malaysian palm oil exports to the region have doubled from 517,000 MT in 2003 to 1.1 million MT in 2009 and with the right strategies and more marketing efforts, the figure is expected to rise further. Among major palm oil importers in the region are Benin and Togo, which also serve as transfer hubs to the Nigerian market. Other countries such as South Africa, Ghana, Mauritania and Tanzania continue to be the main destinations for MPO exports.

Malaysia can leverage on its image as a reputable palm oil supplier to make further inroads in the quantity and market share of palm oil exports to Sub-Saharan Africa. Carrying out tailor-made promotions in the region and providing the right information can play a vital role in generating awareness of the importance of palm oil to entice buying. Others, such as technical collaboration, credit assistance, infrastructure development and quality awareness programmes among the importers, distributors and consumers could also help to expand the palm oil market.

Opportunity for growthNot so long ago, Sub-Sahara did not attract a lot of interest among industry players and

among the issues they cited for not doing business in the region were political and social instability, insufficient market information and lack of infrastructure. However, developments in the past few years have merited serious consideration from Malaysian palm oil players. Companies from China, Europe, Indonesia and Singapore are investing billions of

MALAYSIAN PALM OIL COUNCIL KKDN PP 14669/05/2010 (024659) VOL: 2 2010

MPOC FORTUNE

MARKETING & MARKET DEVELOPMENT DIVISION

For more information, please contact Tel : 603 - 7806 4097 Fax: 603 - 7806 2272

DIRECTOR

Wira Adam wira@mpoc.org.my

MANAGERS

Muhammad Kharibi Zainal Ariffin kharibi@mpoc.org.my

Kamal Wan Roz kamalwr@mpoc.org.my

MARKET ANALYSTS

Asia Pacific Desmond Ng Kok Hooi desmond@mpoc.org.my

Lim Teck Chaii lim@mpoc.org.my

South Asia Fatimah Zaharah Md Nan fatimah@mpoc.org.my

Middle-East Mohamad Suhaili Hambali msuhaili@mpoc.org.my

Africa Nor Iskahar Nordin iskahar@mpoc.org.my

Europe Azriyah Azian azriyah@mpoc.org.my

Americas Ahmad Fadzli Abdul Aziz fadzli@mpoc.org.my

Continued on page 7

®

2003

’000

Ton

nes

2004 2005 2006 2007 2008

Palm Oil Soyabean Sunflower Tallow & Grease Others

4000

3500

3000

2500

2000

1500

1000

500

0

Africa’s Oils and Fats Imports

Sub-Sahara:A Growing

Market for Palm Oil

by Benny LeeChief Market StrategistNextView Group

In my previous analysis and article on crude palm oil price, I have mentioned that more correction is expected and the price should only find support between RM2,350 and RM2,400 per metric tonne if it does not break above the RM2,600 resistance level. Price at that time of writing was RM2,520. The price went above the resistance level and went up further to close at RM2,670 on the 5th of March. I did not provide any upside forecast at that time but from the uptrend channel, the resistance level is RM2,800. Now that the price is near the resistance level of the channel, where is it heading next?

The Palm Oil Conference (POC) is going to be held in the next few days after this article is written, in Kuala Lumpur, and this major event is going to set the direction for the palm oil industry. I remembered in the forecast in New Delhi at MPOC’s POTS event in December that prices are expected to increase, with forecasts ranging from RM2,800 to RM3,200 because of the El-Nino dry weather and replantating exercise. The price at that time was around RM2,500. I believe the forecast for POC this year would be about the same.

Let’s take a look at some recent developments in the palm oil economy in Malaysia. Buying from large importing countries like China, India and the European Union slowed down in February after large shipments in January. According to cargo surveyor SGS (Malaysia) Bhd, Malaysia's palm oil exports in February fell 16% over January’s export to 1.25 million tonnes. Another surveyor, Intertek Agri Services, put February’s export figure as 1.21 million tonnes, down 19% from January. Increasing prices of other commodities boosted market sentiment amid global economic recovery. Crude oil price has gone above US$80 a barrel and prices of metals have increased sharply as well recently.

The price of FCPO has risen 5.9% since last month and based on the moving averages, the correction is over and the price is in an uptrend again. The shorter term 30-day moving average, which has been declining since mid-January, has started to increase in mid-February. The mid- and long-term 60- and 90-day moving averages have been bullish since September last year.

However, the uptrend is supported by a marginally lower volume. Average daily trading volume in January was 9,850 contracts while the daily average in February was 8,730 contracts. Open interests however have increased from a daily average of 21,000 contracts in January to 23,500 contracts in February. This shows that traders are still bullishly holding on to their contracts.

Momentum of price has been strongly bullish in the short-term. The RSI, Momentum and MACD indicators are above the middle level and are still increasing. There are no signs of any weakness in the bullish momentum at this moment. The price volatility has declined marginally this month. The volatility measured by the 14-day Average true range indicator has fallen from RM52 to RM42. A smaller volatility means smaller trading range and less uncertainty.

The price of FCPO is currently near the resistance level of an immediate uptrend channel with a support level at RM2,350 and resistance at RM2,580. With this strong short term momentum, there is a high chance of the price moving higher near this resistance level of RM2,800 if the price does not fall below the immediate support level at RM2,550. If it falls below RM2,550, then expect if to

shift further downwards to next support level at RM2,400.

However, the price of FCPO is being overbought in the short term, I expect the price to pull back to the immediate support level first before making its way to the resistance level of RM2,800. If you still remember, in December 2009, I wrote about that chart pattern (triangle) and in January 2010, the price was forecast at RM3,100, the pattern target is still on track, as long as it stays in the uptrend channel. Recently, the target was strengthened by using Fibonacci expansion rules. I expect this target to be achieved after six to nine months.

MARKETWatchW

MPOC FORTUNE •  3

Mr. Benny Lee is a private trader, trainer and sought-after speaker in the financial market. He is the Chief Market Strategist for NextView Group. NextView Group is a group of companies in the Asian region that provides a leading real-time investment tool for both professional and retail investors.

NextView is also a leading Investor Education training provider. For more information, log on to www.nextview.com.

The above analysis and commentary is based on the writer’s 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.

FCPO daily chart as at 5 March 2010.Charted by Benny Lee using NextView Advisor Professional

Up trendresumes

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: enquiry@fimabulking.com

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

OILS and fats consumption in Morocco reached some 613,000 metric tonnes in 2009. Consumption has remained quite stable for the last five years, at around 612,000 to 630,000 MT a year, except for 2008 when it dropped to 604,000 MT. This was when most countries around the globe faced the economic downturn and financial crisis. Morocco’s per capita consumption of oils and fats is fairly high at 19.2kg per annum, which is close to the world average of 23kg/person/year.

The market dominated by soybean oil makes up 409,000 MT or 67% of the total oils and fats consumed in the country. Other oils and fats consumed in Morocco are olive oil at 92,000 MT (15%), sunflower oil at 59,000 MT (10%) and palm oil at 7,000 MT (1%), making Morocco a predominantly liquid oil market. The country’s self-sufficiency in edible oils and fats is only 34%; more than 400,000 MT of oils and fats are imported annually, with soybean oil being the major import. The country produces more than 200,000 MT of oils and fats annually; with olive oil production at 95,000 tonnes (45%), followed by soybean oil at 54,000 MT (27%), fish oil at 30,000 MT (14%) and sunflower oil at 29,000 MT (14%).

Soybean oil is the major oil imported, at 321,000 MT or 77% of the total oils and fats imported in 2009. Compared with the other major oils imported by Morocco, palm oil is relatively small, at less than 14,000 MT or about 3.4% of the total market share.

Palm Oil SituationMost of the palm oil imported by Morocco is in hydrogenated form and it goes into the manufacturing of solid fats, largely margarine and shortening, while palm stearin mainly goes into soap manufacturing. No palm oil or palm olein is imported for the frying or cooking market since the liquid oil market is dominated by the soft oils traditionally

consumed by the Moroccans. The palm oil market in Morocco is currently dominated by Indonesian palm oil at 72%, sourced from a company that has logistic advantages and facilities in Indonesia.

According to the statistics released by MPOB, Malaysian palm oil exports to Morocco in 2009 were valued at RM6.2 million, with 1,928 MT shipped to the country. Besides palm oil, other palm products that have gained some access into Morocco are palm kernel oil at 1,490 MT (valued at RM5.1 million), 674 MT of oleochemical products valued at RM2 million and finished products such as shortening, vegetable fats and coating fats at 1,330 MT.

Continued on page 9

MOROCCO:

A Huge Market Waiting to be Tapped

Indonesia 10,880 - 72%

Others 420 - 3%

Malaysia 3,800 - 25%

5 Years Average imports of Palm oil(2004-08) - Tonnes, Percentage

Source: Oil World

Table 1: Morocco Consumption of Oils and Fats (‘000 MT)

2005 2006 2007 2008 2009Soybean oil 445 431.2 451.6 418 409Sunflower oil 48.5 39.6 48.6 48 59Rapeseed oil 4.4 13.5 1.5 4 1Corn oil 0 1.5 1.5 1 1Olive oil 59.9 66 61.9 79 92Palm oil 7.5 14 16.6 7 7Palm kernel oil 5.6 4.3 2 4 6Butter, as fat 30.4 30.3 19.6 29 24Fish oil 11.1 8.7 8.1 4 4Tallow &Grease 0.1 11.1 18.9 10 10TOTAL 612.5 620.2 630.3 604.0 613

Table 2: Production of Oils and Fats in Morocco (‘000 MT)

2005 2006 2007 2008 2009Soybean oil 79.9 76 72.6 56 54Sunflower oil 26 22.4 16.7 21 29Rapeseed oil 4.3 14.3 0.6 5 0Olive oil 62.9 81 84.5 90 95Fish oil 35.2 30.8 33.9 29 30TOTAL 208.3 224.5 208.3 201 209

Table 3: Import of Oils and Fats by Morocco (‘000 MT)

2005 2006 2007 2008 2009Soybean oil 336.2 394.5 394.6 325.0 321.0Sunflower oil 19.9 24.5 38.3 31.0 33.0Rapeseed oil 0 0.1 0 0 0Corn oil 0 1.5 1.5 1.0 1.0Olive oil 1.6 1.7 1.4 4.0 6.0Palm oil 11.7 16.1 18.5 8.0 14.0Palm kernel oil 5.6 4.3 2.0 4.0 6.0Butter, as fat 30.4 30.3 19.6 29.0 24.0Fish oil 0 0 0 0 0Tallow &Grease 0.1 11.1 18.9 10.0 10.0TOTAL 405.5 484.1 494.8 412.0 415.0

Source: Oil World

6 •  MPOC FORTUNE

JAPAN’s personal care products market has the potential for high sales growth, as its annual per head expense is 50 euros (RM226.70), much higher than in Europe, where it averages 15 euros. High expenditure is very much linked to widespread belief that it is cheaper to prevent skin and hair problems while young, rather than to fix them later in life. Examining the sale of personal care products by category, skin and hair care products increased by 1.5% a year from 2005 to 2008, and fragrance by 0.7%, compared with the previous year. Fragrance sales are quite stable, for the product is used to demonstrate wealth and nobility.

Hair care productsAmong hair care products, market growth was registered for shampoos, conditioners and styling agents. Colour treatment and hair manicure, which is a new category product of semi-permanent hair dyes, has reduced the use of hair colourants. Hair perm and relaxant products are used in small quantities as many Japanese are of the opinion that perming will cause hair damage and breakage. Shampoos and hair conditioners are the major products in this category.

Surfactants used to produce shampoos are all oleo derivatives, from fatty acids and fatty alcohols originating from coconut oil and palm kernel oil. Globally, alkylethersulphate and aklysulfate are the primary raw materials for the production of shampoos. However,

alkylethersulphate is preferred by Japanese producers who consider it to be milder to the hair and skin. In the United States, manufacturers use aklysulfate as the raw material as it produces more foam.

The main distribution channels for sham-poos are drugstores and supermarkets. A small quantity is sold at convenient stores catering mainly to male shoppers. There are close to 30 brands of shampoo sold in Japan, excluding private labels. However, there are only five major players – Nippon Lever BV, Shiseido Co Ltd, Kanebo Ltd, Kao Corporation and Procter and Gamble Far East Ltd – which collectively command more than 90% of the market. Except for Shiseido, all the other players

target the mass market. Shiseido products cater mainly to high income consumers.

The market for private labels is small as consumers are willing to pay more for branded items. The success of these companies is attributable in part to adver-tising campaigns featuring well-known actresses with long hair. For example, Kao Corp uses Zhang Ziyi, a famous Chinese actress who has long black hair, to promote its Asience shampoo brand. In view of the high cost of brand research, development and promotion, industry growth is concentrated on brand exten-sion, rather than on the launching of new brands.

Hair ConditionerUnlike shampoos that focus on cleansing, hair conditioners are touted as good for

hair repair, to make the hair soft, improve its finished appearance and give a feeling that the hair is healthier after treatment. The majority of the conditioners are for straightening the hair, repairing hair with split ends and a “cure” for those with dry hair problem. The rise in hair treatments is increasing as a result of increased consciousness on hair damage and the rise in the number of people keeping longer hair. The figure below provides estimates of the types and volumes of major surfactants and fatty alcohols used for hair conditioners.

Monotallow trimethylammonium chloride (MMTAC) functions as a rinsing agent. Djtallowdimethylammonium chloride (DTDAC) is included for the wet feel and it

MARKETInsightsIns g

Continued on page 11

Sales of hair care, skin care and perfumes (Billion Yen)

2005 2006 2007 2008 2009EHair care 1210.5 1230.1 1250.2 1268.8 1286.5

Fragrances 62.2 62.5 62.9 63.5 64.2

Skin care 1,485.1 1,536.1 1,579.0 1,613.5 1,639.2

Sale of hair-care products (Billion Yen)

2005 2006 2007 2008 2009EShampoo 188.5 192.7 196.7 200.3 203.3Conditioner 169.8 176.6 182.3 187.4 190.2Styling agents 136.2 138.6 141.7 144.9 148.7Perms and relaxants 6.8 6.7 6.5 6.4 6.3Colourants 86 82.2 79.3 76.0 75.4Others 623.2 633.3 643.7 653.8 662.6Total 1210.5 1230.1 1250.2 1268.8 1286.5

Surfactants commonly used in the shampoo markets

of Japan and USA

Others 25%

Others 19%

Alkyethersulfate 51%

Alkylsulphate 6%

Acid alkanolamide 10%

Alkylamidopropylbetaine 8%

Alkyethersulfate 24%

Alkylsulphate 57%

Japan

USA

Japan’s Personal Care Products:Oleochemical Usage Growing

MPOC FORTUNE •  7

dollars, both in the agricultural and industrial sectors. Only a few Malaysian companies are involved and the region needs further investments from Malaysia as we have the expertise and technical advantage, especially in oil palm plantations and the related downstream activities.

While most economies in the world have reached maturity or are on their way to reaching that stage, Sub-Sahara remains one of the few regions where the full potential to be is yet realised. The rewards may be tremendous for Malaysian palm oil players who are willing to venture into this untapped market. According to the African Development Bank, the region’s gross domestic product is projected to grow by up to 6% in 2010 and unlike the other parts of the world, will continue experiencing strong growth in the coming years. The regions’s close to 700 million people and low per capita consumption of edible oils and fats, at 10.7kg compared with the world average of 23.7kg in 2008, are basic indicators and should provide enough incentives for Malaysian companies to expand their market base in the lucrative edible oil industry.

The production of oils and fats in the region at present is insufficient to cater to the growing demand for domestic consumption. In 2008, local production could only make 55% of the domestic

consumption of 6.3 million MT and this year, domestic demand is projected to grow to 6.7 million tonnes while local production would notch to 3.7 million tonnes. The growth in vegetable oils and fats consumption in the region promises a vast potential for palm oil and the time is ripe to explore this market and reap its rewards.

MPOC is continuously looking for niche areas for Malaysian exporters to expand their market base and to provide outlets to cater to the increasing demand for palm oil in the Sub-Saharan region. Recognising West Africa, with a population of 350 million as one such market, MPOC has chosen to organise a trade fair and seminar, scheduled for November this year in Ghana, one of the most vibrant economies in West Africa. Political stability and with a proven track record in implementing economic reforms, Ghana presents excellent opportunities for Malaysian companies to establish a strong base for marketing products to the local population, as well as serve as a gateway to the other countries in West Africa. Malaysian industry players should use POTS Ghana 2010 as an avenue to explore opportunities for investment in oil palm plantations or oils and fats processing facilities. Iskahar

2003 2004 2005 2006 2007 2008 2009

1400

1200

1000

800

600

400200

0

Malaysian Palm Oil Exports to Sub-Sahara (’000)

2004 2005 2006 2007 2008 2009F 2010F

8000

6000

4000

2000

0

Production Consumption

Sub-Sahara Africa Oils & Fats Production and Consumption (’000)

MARKETInsightsIns gContinued from page 1

Sub-Sahara:A Growing Market

for Palm Oil

MPOC FORTUNE •  9

Prior to 2009, the constraint facing palm oil and its products in getting a bigger market share was because of the discriminatorily high import duty. But in late 2008, the Moroccan government reduced the duty structure from 296% to

2.5% for crude palm oil and 25% for refined palm oil. With this, imports of palm oil by the country last year shot back to 14,000 MT, after a big drop to only 8,000 MT in 2008. Generally, this new tariff supports the import of palm oil and its derivatives by the country.

Despite this increase, Malaysian palm oil and its derivatives dropped to 5,422 MT in 2009 from 9,657 MT in 2008. This was due to limits imposed on the export of crude palm oil by Malaysia. There was no crude palm oil exported to Morocco in 2009.

Penetrating and establishing the oils and fats market in Morocco will remain a challenging one for palm oil players. The consumption of liquid soft oils such as soybean, sunflower and olive oils for domestic and industrial purposes has been the practice in this country for decades and the perference towards to these soft oils in for daily use prevails. Shifting their consumption to palm oil will require an aggressive marketing approach. Higher freight costs due long shipping time and small quantities per shipment have further deteriorated the price advantages of palm oil vis-à-vis soybean oil imports from Argentina.

Nevertheless, with this new tariff in place, there are huge opportunities for the use of palm oil products in the Moroccan market, especially if the blending of palm oil with other soft oils, in order to reduce

the cloudy nature during winter, is taken up by the manufacturers in the cooking and frying sector – and accepted by consumers. In the solid fats sector, the uses of palm oil can also be expanded, since the market is now using mostly hydrogenated soybean oil and hydrogenated sunflower oil, which contain trans fatty acid and therefore contribute to increased risk of heart disease. Palm oil will prove to be technically and economically better than these hydrogenated oils.

Since the major reduction in import duty last year, some Moroccan companies have started to import palm oil, especially crude palm olein, refining and blending it with sunflower and soybean oils in a ratio of 70:30 (SFO,SO:Olein). With this combination, the manufacturers have better earnings, especially when the price of palm oil and its products have larger discounts compared with the other soft oils imported. According to local players, more companies plan to import crude and refined palm oil in near future, with some of them refining the crude oil locally with the facilities that are already in place. Currently, the refining capacity for edible oils in Morocco is close to 900,000 MT per annum. Nevertheless, only 75% of the capacity is operational.

Statistically, the Moroccan market for butter is around 25,000 MT, margarine at 20,000 MT and vegetable oils at 360,000 MT. Other local markets include 1.5 million MT of protein meal for animal feed and 40,000 MT for olive oil. The total market for margarine, which is produced from imported hydrogenated palm oil (HPO), in Morocco and western Africa is 30-40,000 MT a year. Morocco is seen to be a good re-export hub for margarine, especially to the European countries and to western Africa, including Senegal, Mali and Mauritania. There is also the possibility of a higher amount of palm kernel oil to be exported to Morocco as a result of the growing market for oleochemicals. Palm kernel cake can

also find a market in the country as animal food for cattle and poultry.

ConclusionMorocco has a large market for oils and fats. The heavy reliance on imports, at an average of 400,000 MT a year, can be very attractive for the palm oil market. With the current improvement in its economic situation and the changes in its import duty structure, Morocco has good potential to increase its current imports of oils and fats, especially palm oil.

There is a large scope for the use of palm oil and palm oil products in the Moroccan market. Among the liquid oils, palm olein has good potential in the industrial frying sector. In the solid fats sector, the expansion of palm oil products is inevitable as currently, most of the products in this sector use hydrogenated soybean oil and hydrogenated fish oil. Palm oil can therefore be promoted to be scientifically and economically better than the other hydrogenated oils. Consumption of palm oil by food processors and food manufacturers can grow to about 100,000 MT per year from about 20,000 MT now if its usage by these industries can be intensified. Furthermore, Morocco’s potential as a centre for re-export will allow exports of these products to neighbouring countries, especially the West African nations.

Most vegetable oil processing plants in Morocco are not equipped to process palm oil. This is attributed to the fact that the cost of processing soybean oil, or any other oil, is much lower than that for palm oil, after taking into consideration the cost of freight and storage facilities.

Therefore, plant operators in the country would require technical assistance from experienced Malaysian companies to work together with them. Other than that, they also need to be facilitated in certain issues, including logistic arrangements of transporting palm oil from Malaysia and in the processing methodology and handling of palm oil. Suhaili

MARKETInsightsIns gContinued from page 5

Table 4 : palm oil imports from Malaysia

2008 2009

Palm oil 5,608 1,928

Palm kernel 2,365 1,490

Finished product 661 674

Oleochemical 1,023 1,330

Palm Kernel Cake 0 0

TOTAL 9,657 5,422

Source: MPOB

Table 5: Import Tariff

Oils New Structure Old Structure

Crude Refined Crude Refined

Soybean oil 2.5 25.0 46 49

Sunflower oil 2.5 25.0 30 32

Palm oil 2.5 25.0 296 296

Rapeseed oil 2.5 25.0 45 49

Corn Oil 2.5 25.0 279 279

Palm kernel oil 2.5 25.0 296 296

MOROCCO

A Huge Market Waiting to be Tapped

has the feature of fluffing the hair after drying. MMTAC and DTDAC originate from beef tallow. Research by K. Yoshimura shows that palm-based derivatives are now being used interchangeably with MMTAC and DTDAC for hair conditioner production. The higher biodegradability of palm-based derivatives has drawn interest in the market as they break down naturally in the environment.

It may look as though the hair conditioner market is approaching maturity, as there are many brands to choose from in virtually every retail outlet. There are only a few new developments unfolding, intriguing consumers to loosen their purse strings and raise their standards to higher priced, premium brands. New, technologically improved formulations reflect the ability to push up consumers’ expenditures as they look for daily care

products to add volume, thicken thinning hair, maintain colour, straighten curly hair, and more.

ConclusionTaking into consideration Japan’s growing population and affluence, the shampoo and hair conditioner market is expected to increase by a compounded average growth rate (CAGR) of 3.5% a year between 2010 and 2014. As market entry is difficult due to the high costs involved, increased demands will benefit the existing players. Research into the functionality of shampoos and hair conditioners to be sold probably plays the biggest role in the success of any player in the market.

With the use of shampoos in 2009 at 159,999 MT and conditioners at 29,261 MT, oleochemical usage is envisaged to rise from 48,000 MT to 55,644 MT for shampoos and from 8,478 MT to 10,070 MT for conditioners in 2010. Based on research results gathered, oleochemicals are used in 30% of the shampoos and conditioners sold in Japan. To increase sales to this market, aggressive marketing plans by Malaysian palm oil players should focus on researches done on the functionality of oleochemicals for shampoo and hair conditioner production. Lim Teck Chaii

0 2 4 6 8 10 12 14

Kanebo

Kao

Shiseido

NipponLever BV

Kanebo RescheKanebo

Shiseido

FT ShisedoAusiese

Super MildSea Breeze

Tessera

MeritAsience

EssentialLavenusSuccess

Lux Super RichDove

Market share of major players and their brand (%)

2.29.8

0.40.61

1

3.44.6

10.26.6

12.2

4.255

9.2

Monotallow trimethyllammniumchloride 17%

DjtallowdimethylammoniumChloride 4%

Fatty alchohol 72%

Others 7%

Major surfactants and fatty alchoholsused in producing hair conditioner

in Japan

Popular Brands Of Hair Conditioners

Brand Brand owner1 Mod's Hair Styling Air Spray Nippon Lever BV

2 Mod's Hair Control Treatment Nippon Lever BV

3 Mod's Hair Moisture Finnish Treatment Nippon BV

4 Mod's Hair Kesaki Shuchu Treatment Nippon BV

5 Dove Moisture Deep Treatment Nippon Lever BV

6 VO5 Pf t The Straight Treatment Sunstar Inc

7 VO5 Pf t The Straight Essence Sunstar Inc

8 Tusbaki chan no kaimi shitton biyoski Yanagiya Honteri

MARKETInsightsIns gContinued from page 6

Estimated shampoo and conditioner sales in Japan (MT)

2009 2010F 2011F 2012F 2013F 2014FShampoo 159,999 164,799 169,743 174,835 180,080 185,483

Hair conditioner 28,261 29,250 30,274 31,333 32,430 33,565

Estimated oleochemical used (MT)

Shampoo 48,000 49,440 50,923 52,451 54,024 55,645

Hair conditioner 8,478 8,775 9,082 9,400 9,729 10,070

MPOC FORTUNE •  11

Japan’s Personal Care Products:Oleochemical Usage Growing

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 Suite # 690, 21515 Hawthorne Blvd.Torrance CA 90503, USATel: +1 (310) 944 3910Fax: +1 (310) 944 3544www.americanpalmoil.comE-mail: kassim@americanpalmoil.comContact: Mohd Salleh Kassim

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: kumar@mpoc.org.zaPostal Address:P.O.Box 1591M.E.C.C. 4301, South AfricaContact: Uthaya Kumar

MPOC Bangladesh62-63 Motijheel Commercial Area,7th Floor, Amin Court Building,Dhaka, BangladeshTel: +88 (02) 9571 216Fax: +88 (02) 9551 836E-mail: fakhrul@mpoc.org.bdContact: Fakhrul Alam

MPOC Shanghai, ChinaShanghai 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: teah@mpoc.org.cnContact: Teah Yau Kun

MPOC Pakistan11 – 3rd Floor, Leeds CentreMain Boulevard Gulberg, 111 Lahore, PakistanTel: +92 (42) 5716 600 / 5716 601Fax: +92 (42) 5716 602E-mail: faisal@mpoc.org.pkContact: 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: bhavna@mpoc.org.inContact: Bhavna Shah

MPOC Europe Regional Office31 Avenue Emile Vendervelde1200 Brussels BelgiumTel: +32 (2) 7748 860Fax: +32 (2) 7794 371E-mail: zainuddin@skynet.beContact: Zainuddin Hassan

MPOC Cairo3 Gamal E1-Din Afify Street, Nasir CityZone No.6, 11371 Cairo, EgyptTel: +20 (2) 2273 8108Fax +20 (2) 2273 8106E-mail: kazmi@mpocegypt.comContact: Kamal Azmi

MPOC IstanbulGuzel Konutlar SitesiDilek Apartment Daire 3Balmumcu, Besiktas - Istanbul, TurkeyTel: +90 (212) 2668234Fax +90 (212) 2668236E-mail: haznita@mpoc.org.myContact: Norhaznita Husin

For enquiries, please e-mail: fortune@mpoc.org.myor contact: Tel: 603-7806 4097

(Mr. Muhammad Kharibi Zainal Ariffin)

ADVERTISING OPPORTUNITIES®