Palm oil export in January reached US$2.61 billion

This article has been translated by PwC Indonesia as part of our Plantation News Highlights service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.

Investor Daily

29 March 2023

Jakarta - The Indonesian Palm Oil Association (IPOA) noted that the national palm oil export volume in January 2023 reached 2.95 million tonnes, which increased by 6.97% from 2.75 million tonnes in December 2022. Even though the volume increased, the export value of the commodity in January 2023 only reached US$2.61 billion, which decreased by 7.18% from US$2.79 billion in December 2022 due to the decline in palm oil price in the international market.

IPOA Executive Director Mukti Sardjono said that the average price of crude palm oil (CPO) in January 2023 reached US$1,024 per tonne (CIF Rotterdam) with the local price at US$754 per tonne (FOB Dumai KPBN). Meanwhile, the average CPO price in December 2022 reached US$1,035 per tonne (CIF Rotterdam) with the local price at US$755 per tonne (FOB Dumai KPBN). “So, even though the volume increased, the export value of palm oil in January 2023 only reached US$2.61 billion, which decreased from US$2.79 billion in December 2022,” Mukti revealed in his statement as quoted on Tuesday (28/03/2023).

According to IPOA’s records, palm oil export to Egypt, Italy, and Singapore in January 2023 recovered to 57,220 tonnes, 114,280 tonnes, and 23 thousand tonnes from 9,410 tonnes, 72,580 tonnes, and 8,280 tonnes respectively in December 2022. Meanwhile, the plantation commodity export to the markets in Bangladesh, Pakistan, Vietnam, and Russia in January 2023 decreased by more than 50% from December 2022.

At the start of 2023, CPO production in January 2023 only reached 3.89 million tonnes and palm kernel oil (PKO) production reached 370 thousand tonnes, which were relatively the same as CPO production in January 2022 at 3.86 million tonnes and PKO production at 365 thousand tonnes. Compared to CPO production in December 2022 that reached 4.3 million tonnes, production in January 2023 was lower by around 9.5% due to seasonal factors.

On the other hand, domestic palm oil consumption in January 2023 reached 1.79 million tonnes, an increase from 1.49 million tonnes in January 2022, but lower than the consumption in December 2022 that reached 1.94 million tonnes. Consumption for the food industry in January 2023 only reached 793 thousand tonnes compared to December 2022 that reached 901 thousand tonnes. Meanwhile, consumption for biodiesel also decreased to 810 thousand tonnes in January 2023 from 850 thousand tonnes in December 2022. Palm oil consumption for the oleochemical industry in January 2023 reached 183 thousand tonnes, which was relatively the same as the realisation in December 2022 that reached 185 thousand tonnes.

With such composition of production, consumption, and export, palm oil supply in the form of CPO and PKO at the end January 2023 reached around 3.1 million tonnes, which was lower than the supply in December 2022 that reached around 3.56 million tonnes and lower than domestic consumption and export in one month.