Palm oil exports from Malaysia, which waived a levy on shipments for the final four months of 2014, will probably remain duty-free in January as average prices stay below a threshold for a tax to be imposed. The duty, which is based on a price-reference rate compiled by the palm board, will most likely continue at zero, according to CIMB Investment Bank Bhd, BNP Paribas SA and Phillip Futures Sdn. Futures on the Bursa Malaysia Derivatives averaged RM2,204 a tonne from Nov 10 to Dec 9, below the RM2,250 level that triggers the 4.5% tax on sales from the world’s largest exporter after Indonesia. Malaysia removed the duty for September and October and extended the waiver for two months to try to curb the building up of reserves and support prices of its most valuable farm-commodity export. While the move helped spur a bull market, futures still lost 19% this year as demand for the tropical oil used in food and biofuels fell amid a global glut and a slump in crude prices. Data yesterday showed Malaysian reserves climbed to the highest level since February 2013. “If the Government wants to help to bring down the stocks and also try to create some kind of buying market for the consumer to import, I hope that it can maintain the tax at zero for February and March as well,” Donny Khor, deputy director of futures and options at RHB Investment Bank Bhd, said by phone on Dec 8.
Posted on: Tue, 16 Dec 2014 09:16:45 +0000
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