Indonesia’s Palm Oil Exports Post Strong in First Half of 2019

Indonesia’s exports of palm oils have increased in the first half of 2019 amid global challenge and trade barriers. Export of palm oils and its derivatives, including oleochemical and biodiesel, rose 10% to 16.84 million tons in the first half of 2019 from 15.30 million tons in the same period of 2018.

On a press release (6/8/2019), the Indonesian Palm Oil Producers Association (Gapki) said that shipment of palm oils should have increased more significantly. A number of trade barriers have slashed these export opportunities.

Excluding the oleochemical and biodiesel, export of Crude Palm Oil (CPO) and its derivatives rose 7.6% from 14.16 million tons in January-June 2018 to 15.24 million tons in the same period of 2019. However, shipment CPO and its derivatives to most of top Indonesia’s export destination countries have declined, except to China which rose 39% from 1.82 million tons in January-June 2018 to 2.54 million tons in the same period of 2019.

The trade war between China and the US has increased China’s palm oil demand as the country reduce soybean import from the US. The China-US tension has pushed China to replace soybean with palm oil to meet its growing consumption requirement of vegetable oil.

Shipment of CPO and its derivatives to European Union in the first half of 2019 rose slightly 0.7% from 2.39 million tons in the first half of 2018 to 2.41 million tons. Meanwhile, shipments to India dived 17% from 2.5 million ton in the first half of 2018 to 2.1 million tons in 2019. Gapki also recorded a decline in exports of CPO and its derivative products to the US by 12%, Pakistan by 10%, and Bangladesh by 19%. *

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