The strengthening of rupiah against the US dollar and the recovering of economy ahead of the new normal implementation is seen as positive sentiment for business players, including those in palm oil sector.
Gapki Communication Division Head Tofan Mahdi is optimistic that businesses will soon recover. He said that during the last few months the outbreak of Coronavirus disease 2019 (Covid-19) had impacted the palm oil industries, causing the decrease of palm oil exports by around 20 percent. It was resulted from the fact that several seaports in the main export markets such as India, China and Pakistan were restricted and even halted as part of lockdown policy to fight the Covid-19 pandemic.
“But all now have started recovering process. We’re optimistic that not only the palm oil industry, but also other sectors will be soon recovering,” Tofan told Kontan.co.id recently.
Tofan said, however, that the strengthening of rupiah against the US dollar needs further monitoring. “But what’s clear is that the strengthening of rupiah will bring positive impact, especially for companies having financial burden in US dollars.
With exchange rate being maintained, the companies’ cost of doing businesses will not surge. “We see it from a wider perspective, as we also need to monitor further fluctuations of the exchange rates. If the US dollars expensive, then there is a tendency of costs to get higher. With the rupiah appreciation, we hope it won’t happen,” said Tofan.
Tofan noted that the impact of Covid-19 pandemic to the palm oil industry is actually not so significant. It is because the activities in the oil palm plantations and palm oil mills have been undertaken by strictly implementing the Covid-19 preventive protocol. Besides, local market absorption is still promising.
“We’re grateful that amid the Covid-19 pandemic, the palm oil is one of the business sectors that are not significantly affected. Its operations are proceeding under normal condition. Its exports dropped, but there is a big demand from our local market,” he said.
Based on data from Gapki, export of palm oil during April 2020 compared to March 2020 decreased by 77,000 tons, consisting of 44,000 tons of refined palm oil and 33,000 tons of CPO. Based on export destinations, the largest decrease was seen to Bangladesh, Africa and Middle East, respectively at 118,000 tons, 62,000 tons and 56,000 tons as the three export destinations saw big imports in March 2020.
Conversely, export to Pakistan surged by 100 percent to 201,000 tons due to its very low import in March 2020. Export to China rose by 37 percent to 417,000 tons although it was still lower than the palm oil export in April 2019 at 730,000 tons, while exports to India and the European Union (EU) saw a slight increase. The positive trend is expected to continue as the Covid-19 pandemic is steadily receding. (*)
Sumber: kontan.co.id | Image via rmol.id