company news about Indonesia bans palm oil exports

Indonesia, the world's largest palm oil producer, announced it would ban the export of 24-degree refined palm oil from 28th of April.

Palm oil is the vegetable oil with the largest production, consumption and international trade volume in the world. Palm oil, together with soybean oil and rapeseed oil, is called "the world's three major vegetable oils".Indonesia, Malaysia and Nigeria are the world's top three palm oil producers.Indonesian palm oil accounts for more than 55 percent of global supply.And 24-degree refined palm oil accounts for about 40% of Indonesia's total palm oil exports.

This news, the global food oil market caused a huge shock, international oil prices rose sharply, its downstream chemical products such as stearic acid and oleic acid also suspended quotation.

Why would the Indonesian government further expand export restrictions on palm oil?Palm oil is a major export earner for the Indonesian government.Originally, due to market demand far outstripping supply and export price higher than domestic sales price, many Indonesian palm oil producers increased export in order to gain higher profits, resulting in insufficient domestic supply, and Indonesia's palm oil increased by more than 40% in the year.That's why there are restrictions on exports.

Stearic acid, as one of the main raw materials for stabilizers, is bound to be affected by palm oil and further increase the cost of stabilizers.But don't panic in the face of short-term price increases.In fact, I personally think Indonesia's export ban is also difficult to maintain.

Indonesia has an annual production capacity of 45.5 million tons of palm oil and exports about 2,800 tons of palm oil. If all the exported palm oil is sold domestically, its domestic industry cannot completely consume it.Coupled with the loss of 2,800 tonnes of Indian palm exports, Indonesia's exports will also be hit hard.Coupled with the consumption side, PVC industry off-season generally start in July, affected by outbreaks and geopolitical conflict now industry started from the beginning of April, early winters are short of each factory orders, feed, while the supply end rapid contraction, attenuation, but market demand has been so, palm oil prices in the short term bullish, still have to look at the outbreak and market for a long time.