A two-year high in monthly soybean prices, which coincided with Malaysia's announcement that it will begin its B7 palm biodiesel program this month has sparked a bull market for palm oil. "Supply of palm oil may not be so strong as we head toward the later part of the year, because the peak production season appears to have ended," said analyst Ivy Ng of CIMB Investment Bank.
Indonesia will increase taxes on palm oil exports next month, to 9%, from January's 7.5%. Malaysia is continuing its zero-tax policy for a second consecutive month, while India enacted a 2.5% cooking-oil import tax on Jan. 17 in an effort to protect its oilseed growers.
The Union of Concerned Scientists has asked the Roundtable on Sustainable Palm Oil to reduce the environmental effects of palm oil production by protecting forests and limiting the use of pesticides and fertilizers.
As Australia debates its palm oil-labeling bill, there are concerns that the bill's existence could affect the palm oil industry and the laws of other countries. "It would be labeling palm oil for the wrong reasons. It would plant in the minds of consumers that this is a bad oil and it is labeled because it is a bad oil. That's why we don't want this -- it's not true," says Malaysian official Bernard Dompok.
"Does the world really need three palm oil certification bodies?" asks one Malaysian journalist. Malaysia is formulating a sustainable palm oil certification body, joining Indonesia and the multinational Roundtable on Sustainable Palm Oil. "[I]ndustry observers said the formation of the ISPO and the MSPO would indeed challenge the role of pioneering 'voluntary' palm oil certification body -- the Roundtable on Sustainable Palm Oil," writes Hanim Adnan.