MPOB Palmnews
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 Mahamad Rodzi Abdul Ghani
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 Malaysia produced 7m tons of palm oil as of Septem

11/8/2001, ( - As at the end of August this year, Malaysiaproduced 7. 04 million tonnes of palm oil, which represented a 10%,increase over the same period last year.Malaysia is now facing the last quarter of the year where high monthlyproduction level is the norm. It is obvious that this year production willbe more than last year. Nevertheless, the earlier forecast by somequarters that this year production may reach 11.8 million to 12 milliontonnes is inaccurate.Based on recent developments, this years production is forecast to bearound 11.2 million tonnes, an increase of about 0.4 million tonnescompared to last year. Taking into account the beginning stock anddomestic demand, it has been estimated that for the whole of this year, wehave some 11.5 million tonnes of palm oil for export. Thus, the countryhas to do better this year if she does not want to be saddled with highstocks again.For the first eight months of this year, Malaysia is exports have beenquite spectacular when compared on a year-to-year basis. Based onpreliminary figures, the growth of exports during the eight months of thisyear has reached almost 30%, bringing the exports to 7.09 million tonnes.Hopefully, the country’s export for the rest of the year will be betterthan last year.The impressive export performance in the first eight months has resultedin a drop in stocks to 878,300 tonnes as at end-August from 921,700 tonnesat the end of July. This is a huge reduction from the stock level of 1.42million tonnes as at end December 2000 or 1.52 million tonnes as at endJanuary 2001. As for Indonesia, the worldís second largest producer andexporter of palm oil, the production estimates for 2001 are mixed.At the low end, some say Indonesia may produce 7.6 million tonnes thisyear. But others predict Indonesia production to even reach eight milliontonnes. This means that for this year, Indonesia will have between 5.2 and5.5 million tonnes of palm oil for export.Primary Industries Minister Datuk Seri Dr Lim Keng Yaik said he was toldthat for the first half of 2001, Indonesia exports touched 1.95 milliontonnes, which was only a 15.9% increase compared with the same period lastyear.Malaysia exports grew by 30%, which means our export is higher. Maybe thechanges in India duty structure have to some extent affected Indonesiaexport performance. India, beginning March this year, has increased theimport duty on CPO and PPO (processed palm oil), while maintaining theduty on soybean oil, thus making soybean oil more competitive.Since 40% of Indonesia palm oil export to India was CPO, compared to 22%of Malaysia, Indonesia is more adversely affected than Malaysia. Thedevelopments in other oil crops: The US Department of Agriculture (USDA)report of Sept 14, 2001 indicates soybean production in the US in thecoming season is estimated to be higher by three per cent or 77.1 milliontonnes compared to 74.8 million tonnes last year. This represents adecline over USDA earlier estimates. Apparently, the weather conditionsduring planting have not been favourable. This was the reason for anupturn in world oil and fats prices in early July.The production of both rapeseed and sunflower are also anticipated to fallin the coming season. The Canadian rapeseed crop is forecast to decline by28.7% or 5.07 million tonnes from 7.12 million tonnes, while the Australiacrop will be down by as much as 15.8% or 1.43 million tonnes from 1.7million tonnes last year.Sunflower production in Russia and the Ukraine is also expected to fall by12% (i.e. 3.3 million tonnes versus 3.75 million tonnes in 2000) and 26.5%(i.e. 2.55 million tonnes versus 3.47 million tonnes in 2000)respectively. Soybean harvest in both Argentina and Brazil is high at 26.5million and 38.2 million tonnes respectively.