30/04/2008 (Trade Arabia News) - Malaysian Palm Oil exports to the UAE and Bahrain have registered a sharp rise last year, according to latest reports from the Malaysian Palm Oil Council (MPOC).
The UAE export rose 17 per cent exceeding over 350,000 metric tonnes (MT) in 2007 from the previous year, signifying high growth potential for Malaysian palm oil exports to the country.
The UAE’s emergence as a re-export hub for oils and fats products has largely contributed to its rising imports, as 80 to 85 per cent of its acquired products has been re-exported to neighbouring GCC states last year, while the remaining percentage was allocated for local consumption.
The Malaysian palm oil exports to Bahrain have also risen with 986MT in 2007. The promising growth trends in the market have prompted MPOC and the Malaysian Palm Oil Board (MPOB) to host the first ‘Malaysia-UAE Palm Oil Trade Fair & Seminar (POTS) 2008’, next month.
The seminar will be held from May 26 to 27 at the Grand Hyatt Hotel in Dubai.
With aims of leveraging the growing demand for edible oil within the country’s local snack food and catering industries, leading manufacturers from Bahrain are set to attend the seminar.
Within the last five years, the GCC has become a very important destination for Malaysian palm oil, with total exports of the product to the region averaging at around 500,000 MT annually.
The UAE is one among the largest consumers of Malaysian palm oil in the region, recording imports of 264,631 MT in 2003 and 318,871 MT in 2004.
However, the market saw a dip in 2005, when the country reduced its imports to 264,004 MT. The trend has taken an upturn the following year recording 302,738 MT in Malaysian palm oil imports, which preceded the current figures of 354,009 MT.
“The UAE and Bahrain have become leading targets for Malaysian palm oil imports due to increasing local demand for the product in the domestic and industrial sectors and the country’s growing palm product export market,” said Ahmad Zafri Zawawi, regional director - Middle East, MPOC.
“In addition, its strategic geographical location and the existence of other business-encouraging factors within the countries have significantly expanded the business for a majority of local companies, who will be participating at the first ‘Malaysia-UAE Palm Oil Trade Fair & Seminar (POTS) 2008’ to leverage the growing demands in the local and regional market.”
Besides the UAE and Bahrain, Oman and Saudi Arabia too have topped the list of major Malaysian palm oil importers in the Gulf due to their efforts to become leading centres for refining and subsequent distribution of the product to the Middle East.
Import statistics for 2007 revealed Oman has imported a total of 96,359 MT of Malaysian palm oil, while 33,736 MT of the product has been shipped to KSA; 13,527 MT were delivered to Kuwait and 108 MT to Qatar.
Responsible for the bulk of oils and fats imports to the region are edible refineries and manufacturers including Abu Dhabi Vegetable Oil Company (ADVOC), International Foodstuffs Company (IFFCO), Areej Vegetable Oils, United Foods Co., Afia International and Al-Ghurair Foods.
He pointed out that favourable trade agreements between the GCC countries was also driving the growth of the Malaysian palm oil within leading regional markets, with encouraging tax impositions, such as a minimal 5 per cent custom duty for all imported oils and fats raw materials from outside the GCC, working to the advantage of regional players.
'Trading of edible oil products among the Gulf states is also encouraged through a tax exemption for regionally-manufactured and packed goods with 40 per cent value addition, as opposed to the 25 per cent custom duty ad valorem imposed on products imported from non-GCC countries,” Zawawi noted.
Under the theme ‘Exceeding Expectations, Enriching Partnerships’, the event will bring together oils and fats marketers, traders, economists, government officials and industry professionals from the private sector.
In addition, seminars have been designed to encourage discussions on the prospects in the Gulf and to provide networking opportunities for the attendees, with visitors gaining first hand exposure to the latest palm oil products and services from Malaysia via the trade exhibition booths.