Section 1 : CPO Price Trend:
Global Oils and Fats and CPO Price Outlook 2020
Marketing And Market Development Division, MPOC
The Marketing & Market Development Division spearheads the promotion and marketing activities of Malaysia Palm Oil in the effort to make it the leading oil in the global oils and fats market. The aim is to create and establish a positive image for Malaysia Palm Oil in order to maximise returns to the Malaysian palm oil industry.
Market Expansion
This Division enhances the growth of the Malaysia Palm Oil market through new developments and the expansion of existing markets. To compete successfully, innovative approaches are developed. Various proactive programmes targeting trade and consumer markets are carried out to extend into new markets. In addition, new opportunities for investment, cooperation abroad and joint marketing are constantly being sought out to obtain a greater market foothold.
Seminars
Trade fairs and seminars such as Palm Oil Trade Fair and Seminars (POTS) showcase the products and services of palm oil producers and sellers, while broadening their business opportunities. At these events, business contacts and participants are updated with information and knowledge about the palm oil industry.
Market Networking
The development of a market intelligence network, market linkages and awareness programmes helps foster closer ties with industry-related bodies. These strategies help to educate and influence those who have a keen interest in Malaysia Palm Oil, i.e. policy makers, the trade community, consumers, scientists, medical professionals and researchers.
The year 2019 saw the oils and fats situation going through an unprecedented production period which severely affected price movement. Palm oil had a capricious year in terms of prices as the volatile market saw palm oil prices dipped below RM2,000/MT in January but ended the year at above RM3,000/MT. Palm oil production was higher in 2019, but not as high as earlier anticipated due fluctuating weather conditions especially in the second and third quarters of 2019. The higher OER in 2019 was also a factor which contributed to the increased production of palm oil.
For the year 2020, we will analyse issues that will affect palm oil price in 2019 such as demand and supply analysis and we will also take into account the influence of the other competing oils especially in the first half of this year. Demand for palm oil from major consuming countries such as India, China, EU and USA is nevertheless, expected to remain upbeat and we will take these factors into account. The regional analysis on the demand and supply scenarios will be aggregated at the global level to forecast the price, demand and supply balance in 2019.
We anticipate that there will be continued production growth among all types of oils and fats but demand will also continue to increase. In this year the oils and fats production globally will again be led by palm oil which we forecast will be close to 78 million MT and will play a crucial role in the global supply of oils and fats. As the two top palm oil producing countries contributing to 84% of the global palm oil production, Malaysia and Indonesia will be the focus of the international oils and fats trade. With about 28% of the global oils and fats production coming from Malaysia and Indonesia, the role played by both countries is vital in forecasting palm oil price.
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