Press Release
Indonesian Palm Oil Association (IPOA)
Traditional Market Starts Recovering, Raising Hope
Amid the outbreak of Coronavirus disease 2019 (Covid-19) during the last few months, the oil palm plantations and palm oil mills have been operating normally by implementing the health protection procedures with strict discipline.
Production of crude palm oil (CPO) in April 2020 was 12.6 percent higher than CPO production in March 2020, local consumption dropped by 6.6 percent, export dropped by 2.8 percent, CPO price decreased from the average of US$636 per ton in March 2020 to US$516 per ton Cif Rotterdam in April 2020, while its export value dropped by 10 percent from US$1.82 billion to US$1.64 billion.
Compared to January-April 2019, CPO production during the same period in 2020 was lower by 12.2 percent, local consumption was higher by 6.2 percent, export volume was lower by 12.1 percent, while export value was higher by 9.4 percent from US$6.37 billion to US$6.96 billion.
The lower production this year was caused by the long dry season last year. The production increase in April was expected to become as a starting point for the seasonal increase during 2020.
Local consumption of palm oil during April 2020 dropped by 98,000 tons if compared to March 2020 due to the decrease of biodiesel consumption by 113,000 tons which was resulted from the decrease of economic and social activities during the outbreak of Coronavirus disease 2019 (Covid-19), while the increase of biodiesel consumption during January-April 2020 was due to the implementation of B30 program.
The implementation of the large-scale social restriction (PSBB) is suspected to have caused the increase of palm oil consumption for food at only 4,000 tons to 725,000 tons, while consumption of oleo-chemical increased by 11,000 tons to 115,000 tons which is resulted from the increase of hand sanitizer and soap uses. The consumption of oleo-chemical is expected to keep the level of current demand although the PSBB is lifted as the Covid-19 protocol is still maintained.
The palm oil export in April 2020 decreased by 77,000 tons if compared to that of March 2020, which consist 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.
Jakarta, 8 June 2020
The Indonesian Palm Oil Association (Gapki)
For further information, please contact:
Ir. Mukti Sardjono, M.Sc
Direktur Eksekutif GAPKI
Ph. 021-57943871, Fax. 021-57943872
