Palm oil giant says blow to sales is ‘temporary’

The double-whammy to palm oil demand from a trade spat with India and the coronavirus in China is likely to prove only temporary, according to FGV Holdings Bhd., one of the world’s largest producers.
That’s because supplies are low this quarter, and food and fuel demand is set to stay robust over the long term, according to Chief Executive Officer Haris Fadzilah Hassan. India and China are the two biggest importers of palm, the world’s most consumed cooking oil.
“January to March will see low production, and it coincides with a period when the demand is stressed due to Wuhan and India,” Haris said in his first foreign media interview from the company’s headquarters in Kuala Lumpur. Demand will “correct itself” and prop up prices, he said.
A blistering price rally was shattered last month by the outbreak of the coronavirus and a deepening trade spat with India. People in China are staying at home and avoiding restaurants and hotels, curbing demand, while India is restricting imports of refined oil, which is hurting Malaysia amid political tensions. Still, after their steepest monthly loss in seven years in January, prices rebounded this week on the back of a supply squeeze in Malaysia. MDT/Bloomberg