Market Outlook for Malaysian Palm Oil Within

North Africa

Focus on Egypt

The Region of Africa

The Five Sub-Regions of Africa

The North Africa Sub-Region

Overview of North Africa

Population (Millions) Oils & Fats Per Capita Consumption in 2017

(Kg)

2017 GDP per capita (current US$)

2012 2017

Egypt 77.2 97.5 23.4 3,304

Algeria 32.9 41.3 21.5 5,532

Morocco 33.0 357 22.1 3,291

Tunisia 11.4 11.5 31.5 4,415

Libya 6.3 6.3 28.0 2,903

TOTAL 150.8 196.0 - -

Global - - 28.35 -

Source : IMF, Oilworld, Worldbank

Source :Oil World

Major Productions

2017(‘000 MT)

Soybean Oil

Sunflower Oil

OliveOil

Egypt 336 31 22

Algeria - - 80

Morocco 15 15 135

Tunisia 91 - 144

Libya - - 17

TOTAL 442 46 3980.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

50.0%

0

500

1000

1500

2000

2500

3000

3500

4000

4500

5000

2012 2013 2015 2016 2017

Ratio

(%)

('000

MT)

Production Consumption Ratio (%)

North Africa : Oils & Fats Production-Consumption

North Africa : Major Oils & Fats Consumption (2017)

0

500

1000

1500

2000

2500

Egypt Algeria Morocco Tunisia Libya

('000

MT)

Palm Oil Soybean Oil Sunflower Oil Olive Oil Corn Oil

Source :Oil World

q The largest palm oil user is Egypt.q Food manufacturing and food service sectors are the primary users.

q Major imports are soybean oil, followed by palm oil, sunflower oil and corn oil.

-

500

1,000

1,500

2,000

2,500

2012 2013 2014 2015 2016 2017

('000

MT)

Palm Oil Soybean Oil Sunflower Oil Corn Oil Others

Total Oils & Fats Import

North Africa : Oils & Fats Import

Source :Oil World

Palm Oil, 74%

Palm Kernel Oil, 12%

Oleochemical, 9%

Finished Products, 5%

North Africa : Malaysian Palm Oil & Palm Products Exported (2017)

Source :MPOB

EGYPT Oils & Fats Scenario

A Growing Market

q Egypt’s population forecast to reach 100 million by 2021q Growing market for food and agricultural products.

Egypt : Oils & Fats Supply-Demand

0

500

1000

1500

2000

2500

2012 2013 2014 2015 2016 2017 2018E

('000

MT)

Production Import Consumption

Linear (Production) Linear (Import) Linear (Consumption)

Source :Oil World, National Statistics Institution of Egypt

Limited Local Production

0%

5%

10%

15%

20%

25%

30%

0

500

1000

1500

2000

2500

2012 2013 2014 2015 2016 2017 2018E

Ratio

(%)

('000

MT)

Total Consumption Total Production Ratio

q Increasing demand for oils and fats supply.q Local production can only fulfill 20% to 30% of domestic demand.

Egypt : Oils & Fats Production-Consumption Ratio

Source :Oil World

0

500

1000

1500

2000

2500

2012 2013 2014 2015 2016 2017

(‘000 MT)

Sunfloweroil Palm oil Soybean oil Others

q Palm oil accounted for 40 % to 50% of total imports.

Gap Filled by Imports

Egypt : Oils & Fats Imports

Source :Oil World

Palm Oil Scenario

0

200

400

600

800

1000

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

('000

MT)

Palm Oil Import IPO MPO

Egypt : Palm Oil Import

Source :Oil World

No By-Products Category Tonnes

1 RBD Palm Olein Palm Oil 95,948.7

2 RBD Palm Stearin Palm Oil 35,371.8

3 RBD Palm Oil Palm Oil 32,712.6

4 Crude Palm Olein Palm Oil 21,740.0

5 Soap Noodles Oleochemical 10,747.3

6 RBD Kernel Olein Palm Kernel Oil 7,439.1

7 Glycerine Oleochemical 7,406.5

8 HRBD Palm Kernel Stearin Palm Kernel Oil 7,328.9

9 Shortening Finished Products 5,763.0

Malaysian Palm Oil and Palm Products Exported to Egypt (2017)

Source : MPOB

EGYPTOils & Fats Industry

q Afia International Co under Savola Group lead edible oils market share followed by ArmaFood Industries.

q Both companies dominated more than 50% of the market.

3.2

4.1

4.1

4.1

5.8

6.7

27.6

28.7

0 10 20 30 40

Misr Gulf OilProduction

Lesieur SAS

Borg El Arab

Binzagr Co

Al Motaheda

Iffco Egypt SAE

Arma FoodIndustries

AfiaInternational…

Share (%)Source : Euromonitor

Company Shares in 2017 (%)

Egypt : Company Shares (%)

q The most popular channel for Egyptians to buy oil products is at small grocers compared to hypermarkets or supermarkets.

Distribution Channels for Edible Oils in Egypt

Traditional Grocery Retailers (92.2%)Modern Grocery Retailers (7.8%)

Source : Euromonitor

% Breakdown of Store Based Retailing

Company Refining Capacity MT/Day

Arma Food Industries 1000

Iffco Egypt S.A.E. 1000Savola Egypt 1000

Ajwa for Food Industries 600Integrated Oil Industries (IOI) 600

El Fares El Arabi 300

Borg AlArab 200Al Asher for Projects - El Nada 200

Food Industries Holding Co. ( 6 affiliates) 1100

Refining Capacity

Source : MPOC Egypt

q There is zero duties for all crude and refined oils utilised in industrial usage.

Tax Structure

Types of Oils Import Duties

For industrial usageAll crude and refined oils

0%

For retails*All crude and refined oils

2%

* Retail sales for packaging less than 20kgSource : MPOC Egypt

Market Prospects in Egypt

Issuesq Currency devaluationq Different preference from

high-income consumers

Issues & Opportunities

Opportunitiesq Increasing import volume despite

increasing pricesq Competitive price of palm oil compared

to other edible oilsq Well-developed industrial sectorq Growth in food industry

q Strong demand for packaged foodq Higher income consumers

preference towards foodserviceq Increasing number of working

womenq Established international FMCG

manufacturersq Low exchange rate

Growth in Food Industry

Source : Euromonitor

q Rising demand after increase of prices of butter and cooking fats.

q Less expensive.q Considered as reasonable substitutes.q Extensive promotions and advertising

campaign.

Margarine and Spreadsq Cheese industry recorded a volume

growth of 9% in 2017.q One of top exports - processed cheese.q 200 thousand tonnes of vegetable oil in

cheese production.q Major cheese manufacturers – Arabian

Food Industry and Obour Land

Cheese Industry

(‘000 MT) 2013 2014 2015 2016 2017

Total CheeseProduction 671.4 679.3 686.9 692.4 720.0

Palm Oil Usage 155 158 176 188 200

% of Palm Oil Usage 23.1% 23.3% 25.6% 27.2% 27.8%

Source : Euromonitor, MPOC Egypt

Growth in Other Food Sectors

q MPOC Egypt based in Cairo.

q Promotional activities.

q Networking with industry players and

government affiliates.

q Educational campaigns.

MPOC Efforts

q Full of potentials

q Central and strategic location

q Increasing demand

q Positive measures by the Government

Conclusion

Thank You