Pakistan palm oil demands to benefit Southeast Asia

Pakistan palm oil demands to benefit Southeast Asia

Lewa Pardomuan, Reuters, Kuala Lumpur

Pakistan's palm oil imports may reach 220,000 tons a month
over the next few months because of the prospect of exports to
neighboring Afghanistan and a reduced cottonseed oil crop,
traders said on Monday.

Pakistan normally buys 80,000 tons of palm oil a month from
the world's largest producers, Malaysia and Indonesia.

"We expect strong demand to continue until March. When things
are settling down, Pakistan will be exporting a lot of oil to
Afghanistan," said one trader in Malaysia.

"About 70 percent of the oil shipped to Pakistan will come
from Malaysia and I expect imports to reach 220,000 tons in
November and December each," he added.

Some traders dealing with Pakistan said rising imports also
stemmed from several purchases by the United Nations to help the
Afghan refugees.

Other factors included a smaller local cottonseed oil crop,
which is expected to fall 50,000 tons to 400,000 this year, and
better demand during the Muslim Ramadhan fasting month.

Rates to Pakistan, for instance, hovered at US$26-$28 a ton
this week from $23-$24 in early October.

"I am sure India's imports will reach 350,000 tons in November
and December respectively. They have no choice but to buy palm
oil because of tight soyoil stocks," said one trader.

"Farmers in India are selling their winter oilseed crop, but
the oil is still in the hands of local buyers who will only
release it to the market in the future. India can't crush the
whole crop because of its limited crushing capacity," he said.

India, the world's largest edible oil importer, normally buys
250,000 tons of palm oil a month from Malaysia and Indonesia.

India is expected to continue buying palm oil until March
because South American soyoil coming from the next harvest will
only reach the market in April.