Sime Darby Looks to Latin America for Palm Oil Trade

Malaysia’s Sime Darby Berhad is looking to buy refineries in Latin America as it struggles with poor margins and mounting costs, the Oils & Fats International reported citing a Bloomberg report on 14 May. The company had set aside RM400M (US$96M) to invest in refineries, although more would be needed for acquisitions, said Mohd Haris Mohd Arshad, CEO of the group’s downstream business. Haris said Sime Darby had Latin America “on the radar” as it looked to expand its global refining capacity. 
Latin America’s proximity to Europe (the second largest buyer of palm oil) was the appeal, according to Haris. Regarding Europe’s strict regulations on imported palm oil quality, the shorter sailing time of 14 days from Latin America – compared with 30 days from Malaysia and 45 days from Papa New Guinea  – would mean less risk of oil degradation en route.