28/08/2007 (The Star Online), KUALA LUMPUR - Malaysian Palm Oil Board (MPOB) expects crude palm oil (CPO) production will likely drop as low as 14 million tons this year, falling short of its earlier estimate of 16.5 million tons.
Chairman Datuk Sabri Ahmad said the lower estimate was based on the recent heavy floods in oil palm plantations in Johor and abnormal CPO production cycle.
On the positive side, local CPO output this year could also reach just below 16 million tons against 15.9 million tons recorded in 2006.
Sabri was speaking to reporters after the official launch of MPOB’s International Palm Oil Congress 2007 (PIPOC 2007) by Plantation Industries and Commodities Minister Datuk Peter Chin Fah Kui Tuesday.
He said MPOB was committed to the sustainable production of palm oil, which evolved along the supply chain extending to the mills and other downstream sectors.
Earlier, during the launch, Chin said 2007 has been a fruitful year for the oil palm industry, thanks to the bullish CPO prices.
He said: “The price of the commodity will likely trade within the RM2,400 to RM2,700 per ton range in the coming years.”
The price of CPO rallied above RM2,600 per ton in the middle of this year, up from RM1,400 per ton a year ago.
“The commodity will continue to enjoy higher prices given the tight supply in the world’s oils and fats as well as strong demand for palm oil as feedstock for the production of palm-based biodiesel,” Chin added.
In addition, the switch to corn to capitalise on bio-ethanol production among the United States’ soya bean farmers would also help create higher demand for palm oil.
On Malaysia’s Biofuel Act, Chin said, so far, there was no targeted date for implementation.
Chin said the higher raw material (CPO) as feedstock makes biodiesel production not feasible.
“We might think seriously about implementing the Act if the price of CPO falls below RM2,000 per ton,” he added.