PALM OIL GROWTH PROSPECTS IN SUB-SAHARAN AFRICA FOR 2017-2020
50
VIEWS
by Nor Iskahar Nordin
Abstract
Following 2016’s dismal performance, economic growth in Sub-Saharan Africa is expected to rebound this year and accelerate further in 2018. The main sources of growth will be a gradual improvement in global demand and a recovery in commodity prices. 2016 was a difficult year for many countries, with regional growth dipping to 1.4 percent, the lowest level of growth in more than two decades. The economic experts forecast the region’s GDP to increase 2.9%. Next year, the region’s economy is projected to accelerate to 3.7%.
Oil palm is a traditional native crop for West and Central African communities. Most of the palm oil produced is from countries in the Western Africa region such as Nigeria, Ghana, Cote D’Ivoire and Cameroon. In 2016, the region produced an estimated 4.950 million MT of oils and fats mostly in the form palm oil which is estimated at 2.41 million MT, but the production was sufficient to cover only 53% of the total consumption. Oils and fats imports to the region in 2016 totaled 5.34 million MT, out of which palm oil imports amounted to 4.4 million MT.
Palm oil is the most consumed edible oil in Africa and accounts for over 70% of edible oil consumption. The size of the population and low per capita consumption in the region provide the basis for further increase in oils and fats intake. Per capita consumption can range from as low as 5kg to as high as 25 kg. The demand for CPO has increased due to industries like confectionary industries, snacks, soap, spaghetti and others are springing up and expanding. Continue to develop palm oil market demand in cooking sector, edible usage (shortening and margarine) and specialty fats in chocolate, confectionery, bakery and ice cream sector
This presentation discusses the outlook of palm oil import growth into the region until 2020. It also discusses various challenges faced by palm oil exporters into the region. Sub-Saharan Africa presents huge opportunities for Malaysian palm oil industrial player to venture into the region and tap into this great potential market. Doing business in Africa provides unique challenges and endless opportunities. With fewer conflicts and economic growth rates that are now competitive with those of other developing regions. The cost of doing business here can be high, but so too are the rewards.

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