Factors Contributing to China’s Intake of Palm Oil

Article history:
Received: 5 August 2021
Accepted: 30 November 2021

Available online: 3 January 2022

Page number: 1-10

Author: Kalsom Zakaria1 ; Kamalrudin Mohamed Salleh1 ; Sathia Varqa2 ; Norlaila Abu Bakar3 and Rosearnida Senawi1

China, a country with the largest population of over 1.3 billion was identified as a region with huge potential for export market. Currently, China is one of the largest palm oil importers and has shown an increasing trend over the years, with CAGR of 7.87 from 1.40 million tonnes to 6.37 million tonnes between 2000 and 2020. This translated into a scenario of a growing palm market in China. Thus, this study aims to investigate factors influencing the demand for palm oil in China using Autoregressive Distributed Lag (ARDL). Annual time series data from 1980 to 2019 has been used for the analysis. The bound test indicates that there is a long run relationship among the studied variables. The empirical results showed that gross domestic products, both in producing and importing countries; consumer price index; palm oil consumption; the population of China; palm oil and soyabean oil prices are the significant determinants of Malaysian palm oil demand in China.

1 Malaysian Palm Oil Board,
6, Persiaran Institusi,
Bandar Baru Bangi,
43000 Kajang, Selangor, Malaysia.
E-mail: kalsom@mpob.gov.my

2 Palm Oil Analytics Singapore,
485C Choa Chu Kang Avenue 5,
Unit 08-128, 683485 Singapore.

3 Universiti Kebangsaan Malaysia,
43600 UKM, Bangi, Selangor,
Malaysia.