Indonesia swings to trade surplus on palm oil prices

palm-oil-epa-ruling-537x442

Indonesia swung to a higher-than-expected trade surplus in February as a jump in palm oil prices and slowdown in imports boosted Southeast Asia’s top economy, official data showed Tuesday.

The surplus of $785.3 million came after a $431 million deficit in January caused by a controversial ban on mineral ore shipments that hit exports.

Economists had expected a surplus of around $420 million.

Inflation also eased in March, and both indicators add to signs in recent months that the economy has stabilised after being hard hit by emerging market turmoil last summer.

The price of crude palm oil rose about four per cent in February, according to data from the national statistics agency.

Indonesia is the world’s biggest producer of the commodity, which is used in numerous everyday goods from biscuits to shampoo.

Imports fell nearly 10 per cent on year to $13.78 billion, the data showed.

“The trade surplus was beyond our expectation and we believe it was helped by the high (palm oil) prices and a decline in imports,” said Bank Central Asia economist David Sumual.

Inflation eased to 7.32 per cent in March from 7.75 per cent in February due to cheaper food costs, the data showed, continuing a recent downward trend after a surge last year sparked by a fuel price hike.

However, the figure is still above the central bank’s target of 3.5-5.5 per cent.

The data is positive news for the economy after speculation the US Federal Reserve would start to wind down its economic stimulus programme prompted huge falls in the Jakarta stock market and rupiah last year.

Both the currency and stocks have also recently regained strength but the central bank warned last month economic growth was still at risk of further tapering and a slowdown in China.

Analysts have said the bank may face pressure to cut rates from the present 7.5 per cent in coming months, as the country holds nationwide legislative and presidential elections.

Slightly offsetting the news, HSBC’s manufacturing purchasing managers index — a gauge of manufacturing activity — narrowed further in March to 50.1, from 50.5 in February, with the bank blaming a slowdown in domestic demand. A figure above 50 points to growth while anything below indicates contraction.

 

 

 

 

Source : Channel News Asia | April 1, 2014

Advertisements

About thomasdinnocenzi

Thomas D’Innocenzi is a highly accomplished, results-focused international consultant with extensive experience in global sourcing and business development worldwide to meet evolving business needs. Tom has proven ability in implementing and managing profitable global marketing and sourcing operations. He has extensive experience in international business development to accommodate rapid growth. Skilled in building top-performing teams, bench-marking performance, and developing organizations to improve efficiency, productivity, and profitability. Experienced transition leader and change agent. Tom founded Nova Advisors with the mission of providing expert Global Business Development consulting services for companies seeking to expand their market share as an independent consultant. Tom has a network of experts and advisors throughout the Asia-Pacific region and North America. His expertise includes business development, global sourcing, manufacturing, commodities, logistics, QA/QC, FDA, regulatory compliance, sustainability, and supply chain optimization. Tom is experienced in the medical device, apparel, consumer goods and technology services verticals helping companies advance their global sourcing capabilities and develop new markets through a local and sustained approach. Located in SE Asia and the United States, Tom expands market reach to drive sales. His global sourcing strategy includes directly negotiating with commodity suppliers, supply chain networks and distributors for optimal terms based on his expertise and first-hand knowledge of the players. Contact Tom to use his consulting service to increase your global market and make global sourcing profitable for you in the Asia Pacific Region and the United States. http://www.NovaAdvisors.com thomas@NovaAdvisors.com USA Direct: +1.904.479.3600 SINGAPORE: +65.6818.6396 THAILAND: +662.207.9269
This entry was posted in Business, Economy, Global Sourcing and tagged , , , , , , , , , , , , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s