A plantation worker carries oil palm fruit bunch in a plantation in Sukabumi, West Java, July 13, 2018. (Antara Photo/Raisan Al Farisi)

Indonesia Sees Decline in Palm Oil Export

BY :JAYANTY NADA SHOFA

APRIL 20, 2022

Jakarta. The Indonesian Palm Oil Association, or Gapki, announced on Tuesday that the country exported 2.09 million tons of palm oil products in February, marking a 3.7 percent decline from 2.17 million tons in January. 

Indonesia's palm oil export in February was worth around $2.79 billion, down by 0.6 percent compared to the $2.8 billion in the previous month. 

The average crude palm oil (CPO) price of CIF Rotterdam in February was $1,522 per ton, jumping from $1,358 per ton in January. The price was also $469 higher than last February's figures, which stood at $1,053 per ton.

The soaring price, coupled with the declining production at home, affected Indonesian palm oil exports.

“The current global situation is pushing commodity prices higher, including vegetable oils. Supply and demand play a factor here.  Vegetable oil is in tight supply due to crop failures and the Russia-Ukraine war,” Gapki chairman Joko Supriyono told a media gathering in Jakarta.

"The global vegetable oil supply is tight and so is our palm oil. Perhaps things could have been better if Indonesia had abundant palm oil production. But in the first two months of 2022, our production had decreased, automatically causing a drop in exports,” Joko said.

In February, Indonesia produced 3.5 million tons of CPO, down from 3.86 million tons a month earlier. Indonesia’s crude palm kernel oil (CPKO) production also fell from 365,000 tons in January to 329,000 tons in February, according to Gapki.

The world’s largest CPO producer exported 27,000 tons of CPO in February, down from 63,000 tons in January.

Processed CPO exports decreased from 1.69 million tons in January to 1.68 million tons in February. Indonesia's oleochemical exports also slowed slightly from 317,000 tons in January to 298,000 tons just a month after.

The Southeast Asian country managed to grow its CPKO exports to 4,000 in February from 1,000 tons in the prior month.

Processed CPKO exports, however, dropped from 99,000 tons in January to 75,000 in February.

Biodiesel export rose to 7,000 tons in February. It was at 3,000 tons in the previous month.

Gapki data also showed exports were declining in some destination countries but were on the rise in others.

For instance, exports to Africa plummeted by 54 percent to 153,000 tons in February. Exports to the Philippines fell drastically in February to 28,700 tons, down by 55 percent from 63,800 tons a month earlier. There was only a slight export decline to Russia from 69,600 tons in January to 64,200 tons in the following month, Gapki's statistics revealed.

The palm oil association reported a double-digit increase in February exports to the Netherlands, among others, compared to January’s levels. 

Exports to the Netherlands jumped by 42.21 percent to 184,410 tons in February.

Gapki added exports to China stood at 240,300 tons in February, booking a 21.7 percent growth from the previous month.

In January, exports to Ukraine only amounted to 256 tons, but then skyrocketed to 15,280 tons in the following month. Gapki reported that export to Ukraine in 2021 had a monthly average of 25,000 tons.

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