Asian vegetable oil markets seen booming

Asian vegetable oil markets seen booming

KUALA LUMPUR (Reuter): Asian vegetable oil markets are expected to post strong growth well into the next decade as the region's economy booms, experts said yesterday.

Asia already contributes 44 percent of the world's edible oils, and palm oil, its largest product, was expected to see a steady growth in market share, the experts told a conference in Kuala Lumpur.

"In the Asian region, palm oil dominates production with more than 30 percent of volume," Yusof Hashim, chief executive of the Malaysian Palm Oil Promotion Council, said at the Veg Oils, Oilseeds and Meals '97 conference.

World palm oil production was projected to reach 25 million tons by 2005, overtaking estimated soybean oil output of 24 million tons, Yusof said at the conference organized by the Singapore-based Centre for Management Technology.

"Therefore, both Malaysia and Indonesia are expected to dominate the world market of oils and fats," Yusof added. The two countries are presently the largest oil palm growers in the world.

Yusof said palm oil's share of the world oils market was 17 percent last year and was expected to grow to 19 percent by 2000 and 21 percent by 2005.

Other experts at the conference said the bullish outlook for Asia was based on the projected growth of the region, which was expected to account for $3.75 trillion or half of the world's economic expansion between 1990 and 2000.

Consumption of edible oils in Asia was also expected to be enormous after the next decade, with the current population of three billion expected to reach 4.21 billion by 2010, the experts said.

They said production of other Asian vegetable oilseeds such as groundnut, rapeseed, sunflower and sesame was also expected to increase in countries such as India and Pakistan.

India, which has 950 million people, will have to import 1.5 million tons of edible oils for 1996/1997, said G.K. Sood, head of the Vanaspati Manufacturers' Association of India, Imports in 1995/1996 totaled 1.3 million tons, Sood said.

He said India's demand for vegetable oil was expected to grow by 6.5 to 7.0 percent per annum, while production growth would lag behind at 4.0 to 5.0 percent.

Sood, who also monitors the Pakistani market, said Pakistan was expected to import 1.325 million tons of vegetable oils in 1996/97 and 1.35 million tons in 1997/98.

Pakistan, with a population of 135 million, imported 1.26 million tons of vegetable oils in 1995/96.

With demand forecast to grow five to six percent annually, the country was still expected to import most of its requirements. Currently, domestic production is only enough to meet about 23 percent of its needs.