Analysis of the Impact of Changes in Consumption Structure of Domestic Palm Oil Market

Industry is the foundation of the country and one of the most important economic activities of a country. Palm oil, also known as “industrial MSG”, is widely used in industry. Its main consumption can be divided into two categories according to the method of acquisition: It can be directly obtained from palm oil, such as soap, epoxy palm oil and its polyol, polyurethane and polyacrylate products, and the other is oleochemical products such as fatty acids, esters and fatty alcohols that need to be processed and refined. Nitrogen-containing compounds and glycerin, and on the basis of these two categories of products, various derivatives can be produced through different chemical methods, such as pharmaceuticals, lubricants, cosmetics, and the like.

China is one of the major consumers of palm oil. From January to December 2015, China’s palm oil imports were 4.31 million tons, up 8.6% year-on-year. In the 1990s, when palm oil began to enter the Chinese market, its price was low and large. The characteristics of domestic oil traders have been favored, but subject to the import policy of vegetable oils, palm oil imports have been at a low level. In the 21st century, with the gradual lifting of the ban on vegetable oil import restrictions in China, domestic palm oil imports have increased year by year. At the same time, the domestic palm oil industry consumption has also increased steadily, from less than 300,000 tons/year in 2000 to 2 million tons/year in 2015. However, subject to the continuous increase in palm oil prices and the improvement of the domestic economy in recent years, the market small-package blending oil has been sought after by people. The industrial consumption of palm oil has been weak in recent years, and it is lower than the overall consumption of palm oil in China. Consumption, the author analyzes that the domestic palm oil industry consumption will increase steadily, and the main consumption of domestic palm oil will also be biased towards industry by consumption.

With the continuous improvement of China’s economic environment, the living standards of residents have also been continuously improved. The general public’s requirements for food have been freed from the minimum requirements of “satisfaction” and began to improve to healthy foods and nutritious foods. As a kind of vegetable oil with more than 50% saturated fatty acid, palm oil has been questioned in recent years. Some people even devalue it as a vegetable oil that is harmful to human body even if it is not as good as lard. It’s biased, but it’s also a positive reaction to the lack of confidence in the health of palm oil foods. In the first half of 2016, McDonald’s, a large international fast food chain, announced that it will abandon the use of palm oil to switch to healthier soybean oil( 5464 , 50.00 , 0.92% ) 2017. This decision will reduce the amount of palm oil used. However, as one of the two major foreign fast food brands in China, McDonald’s is more likely to be seen as an improvement to cater to the food health requirements of Chinese people. Although many experts and scholars in China have made a lot of arguments about the health of palm oil, which proves that palm oil is harmless to the human body, palm oil is consumed because of people’s inner fear of unknown things and distrust of domestic experts and scholars. Consumption will be restricted.

Due to food safety and price constraints on domestic palm oil consumption, domestic consumption of palm oil has stabilized and declined in recent years. In the latter stage, the author believes that the main domestic consumption growth point will shift to industrial consumption. The main reasons are:

1. The instant noodle manufacturing industry is the main land used by the domestic palm oil industry. In recent years, due to population growth, people’s living standards have been slowed down, and instant noodles consumption has also become saturated. According to Brecker statistics, China from March to December 2015 The output of instant noodles was 8.689 million tons, 8.6 million tons in the same period of 2014, and 8.83 million tons in 2013. However, the output value of the instant noodle industry was 100 billion yuan, and China’s huge population base and holiday consumption drove the large-scale collapse of the instant noodle industry. The possibility is not big, the late instant noodle industry will still support the domestic palm oil industry consumption (according to the law of one ton of oil and 50 tons of noodles, the instant noodle industry will drive about 200,000 tons of palm oil consumption annually).

2. The standard of living of Chinese people will increase, and the demand for daily household products such as soap will continue to increase to support the consumption of palm oil.

3. The upgrading of the oleochemical industry, the main industrial products of palm oil also began to change from low-end, low added value to high-end, high added value, and the downstream product line also extended (for example: low-end soap to high-end cosmetics transfer, extension line products) Lines such as medical equipment, lubricants, etc., will be a new growth point for the late palm oil industry.

According to the US agricultural forecast data, the use of Malaysian biodiesel raw materials (palm oil) in 2016 was about 647,000 tons, accounting for 3.55% of Malaysia’s 2016 crude oil production of 18.2 million tons, accounting for about Malaysia’s domestic palm oil use. About 30%, Indonesia now exports about 30% of total European imports of biodiesel to Europe. Its domestic demand for biodiesel in 2014 was 1.4 million tons, and in 2015 it was 2.8 million tons. In 2016, it is preparing to implement B20 organisms. The diesel policy (which has not been implemented for various reasons) is expected to consume 8 million tons of palm oil, accounting for about 25% of its total production, while our main domestic biodiesel is also based on palm oil. The resources are depleting, and the development prospects of biodiesel as a new energy source are bright.