KUALA LUMPUR, Aug 1 — Malaysia’s crude palm oil (CPO) prices are expected to trade in the range of RM3,700 to RM4,200 per tonne during the second half of 2023 (2H 2023), said the Malaysian Palm Oil Council (MPOC).

Its deputy director of marketing and marketing development Mohd Izham Hassan said that over the past two weeks, CPO prices had shown an uptrend.

"The price surge is also driven by concerns over reduced palm oil supplies, particularly as Malaysian palm oil production in the first half of 2023 decreased by approximately three per cent compared to the same period in 2022,” he said at the Digital Market Forum webinar hosted by MPOC today.

MPOC also projected that the CPO prices might trade above RM4,300 per tonne in the long term and ahead into 2024 due to prevailing market uncertainties, including the uncertain sunflower oil situation from the Black Sea region and Malaysia’s palm oil production remaining below expectations.

On the demand outlook, Mohd Izham predicted that India and China would import a combined value of 16.5 million tonnes by December 2023.

"These two countries, which collectively imported a total of 15 million tonnes of palm in 2022, will continue to be the two largest importers of palm oil,” he said.

Mohd Izham said that the Asean and the Middle East and North Africa regions would also experience higher demand for palm oil due to inadequate domestic production and the competitive price of palm oil.

"Meanwhile, Sub-Saharan Africa (SSA) shows significant growth potential for palm oil, with the region importing 3.5 million tonnes in 2022, led by countries like Kenya, Tanzania, Togo, Mozambique, and Nigeria,” he said.

Despite this outlook, he noted that per capita consumption of oils and fats in the SSA region would remain low.

"However, with improving economic conditions and increased per capita income, this consumption is expected to rise,” he added. — Bernama