Little improvement seen in palm oil exports

Bureaucratic woes in China and slow demand from Indian and European buyers could see little improvement in Malaysian palm oil exports in January after a gloomy December, industry sources said on Tuesday.
With Chinese New Year - Beijing's biggest festival - just weeks away, palm oil's biggest consumer seems to be adequately stocked thanks to significant purchases made in the last quarter of 2003, oils exporters in Kuala Lumpur said.
January shipments to China could also be slow as Beijing's import permits for 2004 may not be ready, the exporters said.
China has committed to buy 2.7 million tonnes of palm oil this year, or 100,000 tonnes more than in 2003, as part of a deal with the World Trade Organisation.
But it has yet to announce whether import permits for 2004 are already available or if importers will have to seek temporary extensions on last year's permits.
"There's no clarity on this, even among the importers in China, and that's probably one of the reasons why there're so few orders placed by them for January," said a Malaysian freight broker familiar with the situation.
Cargo bookings showed China had committed to around 60,000 to 80,000 tonnes of Malaysian palm oil over the last week, the broker said, adding it could ultimately take about 120,000 tonnes for January.
Last month, China bought 225,551 tonnes of Malaysian oil.
Malaysian palm oil exports for December were markedly lower than November, owing to long year-end holidays which affected demand in most consuming centres.
Cargo surveyors estimate month-on-month shipments fell around 15 percent in December, although exports for the whole year were up 13 percent when compared with 2002.
Palm oil dealers had said a pick-up in demand was almost certain in the first quarter of 2004 as soyoil, palm oil's main alternative, was in short supply due to crop woes and possible rationing in the United States.
But the upswing may happen only from February as other major importers such as Indians and Europeans were also dragging their feet into the New Year.
"Indian bookings for January have been very thin, only around 30,000 tonnes so far, while the Europeans are still checking price levels after returning from holidays," said a shipping agent in Kuala Lumpur.