Turkey, MENA Set To Import More Palm Oil Following Normalisation

KUALA LUMPUR, June 29 (Bernama) -- Turkey and the Middle East and North Africa (MENA) region are poised to see more biodiesel demand and therefore higher imports of palm oil, having recently initiated a normalisation process following decreasing COVID-19 cases and deaths there. Veysel Kaya, a representative of Ankara, Turkey-based consultancy and brokerage of oilseeds Sunseedman, said this normalisation signaled a recovery in economies and incomes, as well as stronger petrol prices that would lead to more biodiesel demand and hence improvement in imports of palm oil. “If the normalisation process is done properly, soon petrol prices may jump to over US$45 per barrel and even the psychological and critical level of US$50 per barrel from the current US$41.02 per barrel (US$1=RM4.29). “Then, with better palm oil demand for biodiesel and HoReCa (hotel, restaurant and café) sectors, Bursa Malaysia palm oil prices may hike to RM2,400 to RM2,500 per tonne and refined palm olein may settle at US$600 per tonne or even US$625-US$650 per tonne,” he said in a slide presentation titled “Turkey & MENA - Next Growth Frontiers for Palm Oil”. The presentation was released during a seven-day web-based Palm Oil Internet Seminar (Pointers) that ended Sunday. The webinar was organised by the Malaysian Palm Oil Council (MPOC) and Bursa Malaysia. According to Veysel, the reactivation of the tourism and HoReCa sectors would also mean more demand for palm oil. “Turkey is among the major global palm oil and palm kernel oil importers while the Middle East imports about two million tonnes of palm oil per annum. “However, the COVID-19 pandemic really gave significant challenges for the commodity’s demand globally, including palm oil consumption in Turkey, the Middle East and North Africa. We saw demand for palm oil lessen as people changed their lifestyles due to the deteriorating economies, with employers cutting employees’ incomes,” he explained. Turkey is one of the countries known and respected for services and cuisines, but the limited tourism activity has impacted the HoReCa sector and employees in the sector. Meanwhile, in the Middle East, tumbling petrol prices, deteriorating economies, rising jobless rate and falling incomes pressured the region and its people. It also limits tourism, conferences and fairs in Dubai and is reducing the number of pilgrims performing the hajj. Shanghai Pansun Company representative Cai Neng Bin, another panellist, said the epidemic and the decline in crude oil prices affected palm oil demand expectation, and the slowdown in production should also be closely watched. “The market price trend fluctuates between bulls and bears mood due to the export situation. The key to better market command is to arrange sales and purchasing plans earlier and reasonably,” he said. Cai noted that China might not have strong intention to replenish its current low palm oil stocks, given the expected increase in crude palm oil prices in the second half of 2020. -- BERNAMA