Azerbaijan's palm oil imports show mixed trends as experts predict future decline
Nazrin Abdul
Read moreAzerbaijan has maintained its palm oil imports from Southeast Asia in 2024, purchasing 23,818 tons in the first half of the year—a slight increase of 0.6% compared to last year. However, the cost of crude palm oil has decreased by 3.2% due to lower prices, Azernews reports.
Indonesia, once the dominant supplier, saw its share of Azerbaijan's imports fall from 75% last year to 54% this year. This shift is attributed to a significant rise in imports from Malaysia, which surged by 86% to 11,054 tons. Conversely, imports from Indonesia dropped by 28% to 12,912 tons.
Experts suggest that demand for palm oil may weaken in the near future due to the appreciating Malaysian ringgit and growing inventories. Steven Chong of Apex Securities points out that the stronger ringgit and shifting price dynamics between palm oil and soybean oil could impact demand.
Chong forecasts average crude palm oil prices of 4,000 ringgit/tonne for 2024 and 3,800 ringgit/tonne for 2025. The current futures contract for November is approximately 3,866 ringgit/ton.
Apex Securities maintains a neutral outlook on Malaysia's agriculture sector, citing a lack of short-term drivers. Meanwhile, Azerbaijan's cost per ton of crude palm oil has decreased from $1,231 to $1,184, offering some financial relief.
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