Malaysia’s palm oil output is expected to drop to 19.8 million tonnes in 2018 as compared to 19.92 million tonnes recorded in 2017 due to lower yields, said Oil World executive director Thomas Mielke.
“Yield trend is declining. There was a strong recovery seen in production last year and the first four to five months of this year, but it is temporary.
“It’s not continuing,” Mielke said during his presentation at the Malaysian Palm Oil Trade Fair and Seminar (POTS) 2018 here today.
Malaysia’s palm oil output is expected to drop to 19.8 tonne in 2018 as compared to 19.92 tonne recorded in 2017 due to lower yields, said Oil World executive director Thomas Mielke. Pix by NURUL SHAFINA JEMENON
He had earlier forecast annual production would rise to 20.2 million tonnes, adding that yields is expected to decrease to 3.87 tonne per ha in 2018 from 3.94 per ha in 2017.
However, he said, Malaysian palm oil production is expected to increase to 20.4 million tonnes in 2019, due to high inventory numbers and the fact that the country was not badly hit by El Nino season in 2018.
Globally, Mielke said palm oil production is expected to rise to 70.22 million tonne in 2018 from 67.94 million tonne in 2017, and increase further to 72.69 million tonne next year.
Meanwhile, Mielke said palm oil prices is expected to pick up moderately to RM2,500 a tonne in the next six months.
He said the current weakness in prices was due to lower than expected imports globally.
“Palm oil prices declined more sharply than expected and approached a 10-year low lately. This is partly as a result of a plunge world imports by 0.6 million tonne from a year earlier in April to July 2018.
“But with current stocks low in many importing countries, purchases have to pick up in the months ahead,” he said.