• Bloomberg reported that Cofco International has vowed full traceability for all the soybeans that it buys directly from farmers in Brazil by year 2023F. The commitment would force the global trading arm to be able to trace back all the soybeans to specific farms and locations that are not from land cleared of natural vegetation. Full traceability would be verified by a third party. Cofco is vowing to trace more than 50% of its Brazil soybean purchases in 2020E.

• Bloomberg quoted the Solvent Extractors Association of India as saying that state governments in India must enforce the ban on the sale of loose cooking oils to consumer to check adulteration. Sale of cooking oil in loose form has been banned in India for many years but it has never been implemented. Edible oils should be sold in tin and plastic containers following an advisory by the Ministry of Consumer Affairs, Food and Public Distribution.

• The Star reported that Malaysia’s palm oil industry has warned that the EU’s recent proposal to make its food industry more sustainable could eventually lead to stricter regulations for palm oil. The MPOC (Malaysian Palm Oil Council) is worried that the EU, which is pushing for a “fair, healthy and environmentally friendly food system”, could decide to implement its own sustainability standard for palm oil. The fear is that EU’s standards will be extended beyond the EU’s borders.

• The Economic Times of India reported that Indian sugar traders are eyeing export deals with China, which they say are still viable in spite of a 50% customs duty. The issue is the border tensions between India and China. An official with All India Sugar Trade Association said that although trade enquiries are coming in, companies have yet to sign deals. He added that although there might be a short-term delay in business dealings, exporters see China as a major market for Indian sugar in the long term. Another industry player said that they are sceptical on whether to export currently. There is risk of undue scrutiny at destination ports, leading to delays and hold-ups.

• Foodnavigator.com said that the Philippines government is considering implementing higher sugar taxes as well as taxes on “junk food” high in sodium and trans-fats to offset the costs incurred due to Covid-19. The initial suggestion is to index or adjust the sugar tax to a 6% levy based on sugar content and progress from there. This is expected to add PHP2.9bil (US$58.2mil) to government funds in year 2021F, PHP6.4bil (US$128.5mil) in year 2022F and PHP10.7bil (US$214.8mil) by year 2023F. Currently, the sugar taxes in Philippines are PHP4.50 (US$0.09) per litre for beverages sweetened with a caloric or non-caloric sweetener (non-high fructose corn syrup) and PHP9.00 (US$0.18) per litre for those with high fructose corn syrup.

Source: AmInvest Research - 13 Jul 2020