EU Palm Oil Imports May Top Record as Soy Drops, Oil World SaysWhitney McFerron
European Union palm oil imports may climb to a record this season as supplies of oil made from soybeans and sunflowers decline, Oil World said.
Purchases of palm oil in the 27-country bloc may climb to 6.4 million metric tons in the year that began Sept. 1 from 5.83 million tons a year earlier, the Hamburg-based researcher said today in an e-mailed report. In the fourth quarter of 2012, EU imports were 1.68 million tons, 19 percent higher than a year earlier, with most supplies coming from Indonesia and Malaysia, the world’s biggest producers, as well as from Central America. Germany, the Netherlands and Italy saw the biggest increases, Oil World said.
Palm oil prices slid 23 percent last year on the Malaysia Derivatives Exchange, touching a three-year low on Dec. 13, as global stockpiles climbed to a record. Soybean futures rallied to an all-time high in September on the Chicago Board of Trade as drought cut U.S. production. EU soybean oil imports fell to 366,000 tons in 2012 from 748,000 tons in 2011, Oil World said.
“Palm oil is needed to offset the reduced consumption of soya oil and sun oil,” Oil World said. “Also, the recent low prices have generated considerably higher palm oil demand in the EU energy sector, for electricity generation as well as for biodiesel.”
EU sunflower oil imports rose to 1.026 million tons last year from 857,000 tons in 2011, according to the report. The U.S. Department of Agriculture estimates that EU sunflower oil production this year was 2.68 million tons, down 8.2 percent from a year earlier. Some southern and eastern EU countries had drought last year. EU imports of rapeseed oil fell to 336,000 tons last year from 611,000 tons a year earlier, Oil World said.
The price of olive oil may increase after hot and dry weather hurt crops in Spain, Oil World said. Production from October to January totaled 544,000 tons, 61 percent less than the same time a year earlier, it said. The country’s output in the year that began Oct. 1 may be 700,000 tons, down from a record 1.734 million tons in the 2011-12 season, Oil World said. Spanish prices at 2.95 euros ($3.71) a kilogram are 60 percent higher than a year earlier, it said.
“Olive oil supplies are expected to continue to tighten in January to September 2013,” Oil World said. “Additional price strength is likely to occur to accomplish the necessary demand-rationing in olive oil in the months ahead.”