Paks July palm oil imports high for Ramazan

Pakistan’s palm oil imports rose sharply in July and are likely to top 250,000 tonnes to cover demand for the holy month of Ramazan, a top industry official said on Thursday.
Malaysia shipped 174,416 tonnes of palm oil products to Pakistan between July 1-20, the Malaysian cargo surveyor Societe Generale de Surveillance said, and the official said more shipments were booked for July.
“Pakistan has already covered the Ramazan requirements and I am anticipating shipment from Malaysia alone in July will be 250,000 tonnes,” Rasheed Janmohammad, vice chairman of the Pakistan Edible Oil Refiners’ Association, told Reuters.
“It’s a record shipment for the month of July for a couple of reasons. Firstly this oil was bought primarily for Ramazan, and secondly Pakistan’s shipment for June was low because of traditionally low demand in Summer.”
Janmohammad expected purchases for August at more than 150,000 tonnes due to the festival of Eid al-Fitr that marks the end of the month-long fasting period. Ramazan starts in the second week of August.
Pakistan, the world’s fourth-largest buyer of vegetable oils, imports 80 percent of its palm oil, with Malaysia providing roughly 90 percent of that. The remaining imports come from Indonesia.
Pakistan imported $1.31 billion worth of palm oil products and crude palm oil in the fiscal year to June 2010, nearly 4 percent less than the previous year, official estimates show.
Traders were expecting edible oil prices to go down in the domestic market due to an oil glut, but Janmohammad said that was now unlikely after international prices rose on low Malaysian stock and the lack of availability of oilseeds from Canada and East Europe.
In its 201011 budget announced in June, the government reduced customs duties on crude palm oil imports by more than 11 percent, to 8,000 rupees ($94.15) per tonne from 9,000 rupees.
But Pakistan charges 15 percent less duty than the standard rate on Malaysian crude palm oil imports under a 2007 tariff agreement.
Indonesia has been pushing Pakistan for the same deal under a proposed free trade pact the two countries are presently negotiating.
Pakistan was due to hold the next round of talks in Islamabad in July, but they have been delayed, a Commerce Ministry official said.
In exchange for cuts on palm oil duties, Pakistan is seeking concessions from Indonesia on textiles, seafood and agricultural goods.

Copyright Reuters, 2010