KUALA LUMPUR (Dow Jones)--Pakistan, the third-largest buyer of palm oil after India and China, may step up purchases of crude palm oil after the government reduced the import duty on the commodity in a new federal budget, a senior executive said Monday. "Much of the rise in CPO imports will likely come from Indonesia," a Pakistan-based trading executive at Jaleel Brothers Ltd. said by phone. "Should Pakistan complete the free trade agreement with Indonesia, CPO purchases from Indonesia will be higher."
Pakistan reduced the import duty on CPO to PKR8,000 ($94) a metric ton from PKR9,000 in the budget released Saturday. The country sources around 95% of its palm oil from Malaysia and the remainder from Indonesia. In the last few years, Pakistan has bought more CPO from Indonesia due to a quota Malaysia imposes on CPO exports to encourage sales of higher-value refined palm products. Pakistan relies heavily on imports to supply its edible oil consumption of 3 million tons a year, as it produces only 800,000 tons of oil a year from sunflowers, rapeseeds and cottonseeds.
-By Shie-Lynn Lim, Dow Jones Newswires; +603 2026 1233; firstname.lastname@example.org
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