‘Apparently it has something to do with the Russia-Ukraine crisis.’
The Malaysian Palm Oil Board (MPOB) said the surge in crude palm oil (CPO) prices was related to the increase in Brent oil prices following the Russia-Ukraine crisis and production limits set by the Organization of the Petroleum Exporting Countries (OPEC).
According to MPOB managing director Datuk Dr Ahmad Parveez Ghulam Kadir, the price of Brent crude oil was trading higher at US $ 115.58 per barrel on March 1 compared to $ 103.87 per barrel on February 28.
In the local market, the daily CPO price recorded an all -time high of RM7,600 per tonne with the highest and lowest trading contracts at RM7,700 per tonne and RM7,500 per tonne.
Below is a summary of the factors of soaring CPO prices.
The strengthening in the price of Brent crude palm oil in the next market, makes crude palm oil more of an option for biodiesel raw materials
The upward trend in the price of soybean oil, where, it traded as high as $ 1,457 per tonne in December 2021, $ 1,508 per tonne in January 2022 and as of March 1, 2022 it soared at $ 1,804 per tonne.
*India had to increase imports of crude palm oil due to delays in the delivery of sunflower oil due to the Russian-Ukrainian crisis to meet the demand of its population.
*India imports the largest palm oil from Malaysia and Indonesia and imports the largest vegetable oil (soybean oil from Argentina and Brazil, sunflower oil from Russia and Ukraine).
The lack of CPO production of 1.25 million tonnes compared to 1.45 million tonnes in December has led to a spike in its price.