Business Economy : CPO dominance of world vegetable oil markets

Business economy - crude palm oil (CPO)Crude palm oil is increasingly dominating the international vegetable oil markets. supplies and prices much cheaper than other vegetable oils to make 60-70 percent of CPO control international commodity trade.

Indonesia is also likely to increase CPO market share from 47 percent to 50 percent by 2010 with production raise more than 21 million tons. These conditions further confirmed the position of Indonesia as the world’s largest CPO producer. year 2010, Indonesia will produce 20 million tons of CPO from an area about 7.9 million hectares.

of that number, only 5 million tons is absorbed by the domestic market and the rest is exported. In 2008, Indonesia exported 16 million tons of CPO with a value of 12.4 billion U.S. dollars.

Dorab said, soybean production in Argentina and Brazil declined due to predicted rain. As for soybean production in other countries, except the United States, are not reliable because of the low land expansion.

Soybean oil stocks

at the same time, the world vegetable oil demand will rise 5.5 million tons. higher than the growth in world supply of 3.25 million tons.

from the 2010 request, 50 percent require CPO. dorab estimates, the CPO price in malaysia will increase the range of 2800-3000 ringgit per tonne and cooking oil (refined, bleached, and deodorized olien) 900 U.S. dollars per ton in January 2010.

CPO prices likely to rise as soybean oil stocks last two months is very low. forward stock was still very low so that tighter supplies.

james said, CPO increasingly dominate the market for other vegetable oil supply is limited. however, he expressed concern due to rising inflation CPO.

“if (inflation) this happens, the government will reduce spending. demand is also affected because consumers in some developing countries are very sensitive to price,” said James.

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