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An empirical analysis of Malaysian palm oil export to world major palm oil importing countries:

Author

Listed:
  • Nur Ain Mohd Hassan
  • Kalsom Zakaria
  • Kamalrudin Mohamed Salleh
  • Siti Mashani Ahmad

Abstract

The paper explores the long-term causal relationships of Malaysian palm oil exports with the real effective exchange rate of the respective importing countries, palm oil consumption, vegetable oil production, and GDP growth. The study applied panel cointegration and causality approaches based on data from 10 main palm oil importing countries between 2004 and 2018. The impacts of economic growth, the effective real exchange rate, and the production of other vegetable oils by the main palm oil importing countries on Malaysian palm oil exports were found to be negative. However, palm oil consumption by the main palm oil importers was found to be a statistically significant positive determinant of Malaysian palm oil exports. This finding indicates that consumption has a direct positive effect on the demand for exports. A panel Granger causality analysis revealed a unidirectional causality between importing countries’ production of other vegetable oils and Malaysian exports of palm oil.

Suggested Citation

  • Nur Ain Mohd Hassan & Kalsom Zakaria & Kamalrudin Mohamed Salleh & Siti Mashani Ahmad, 2023. "An empirical analysis of Malaysian palm oil export to world major palm oil importing countries:," Operations Research and Decisions, Wroclaw University of Science and Technology, Faculty of Management, vol. 33(1), pages 61-73.
    • Handle: RePEc:wut:journl:v:33:y:2023:i:1:p:61-73:id:5
    DOI: 10.37190/ord230105
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    References listed on IDEAS

    as
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    4. Rini Yayuk Priyati, 2018. "Determinants of Global Palm Oil Demand: A Gravity Approach," Economic Journal of Emerging Markets, Universitas Islam Indonesia, vol. 10(2), pages 148-164, Oktober.
    5. Peter Pedroni, 1999. "Critical Values for Cointegration Tests in Heterogeneous Panels with Multiple Regressors," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 61(S1), pages 653-670, November.
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    7. Awan Setya Dewanta & Riza Noer Arfani & Erfita Erfita, 2016. "Elasticity and competitiveness of Indonesia’s palm oil export in India market," Economic Journal of Emerging Markets, Universitas Islam Indonesia, vol. 8(2), pages 148-158.
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