MARKET DEVELOPMENT
MPOC Forecasts CPO Price Uptrend To Continue This Year
MPOC Forecasts CPO Price Uptrend To Continue This Year
27/01/2016 (Bernama) - The Malaysian Palm Oil Council (MPOC) forecasts the crude palm oil (CPO) price uptrend will continue this year on lower-than-expected production which will affect supplies.
Its Chief Executive Officer, Tan Sri Yusof Basiron, said the CPO price was expected to be an average of RM2,590 per tonne and will not likely fall below RM2,000.
"The CPO price was traded at an average of RM2,172 per tonne in 2015, went below RM2,000 per tonne and to as low as RM1,975 in August 2015.
"However, it has recovered since then and finished on a high of over RM2,400 per tonne at end-December 2015," he told reporters at the 18th Malaysia Strategic Outlook Conference 2016, themed 'Coping with Uncertainty - The Way Forward in Difficult Times', here Tuesday.
Yusof was one of the panellists at the event organised by Asian Strategy & Leadership Institute.
On a macro level, Yusof said, global palm oil production was expected to be lower than earlier forecast due to the El Nino phenomenon which will affect output.
To tighten supply even further, Malaysia has undertaken a major replanting exercise which will further cut production by as much as 300,000 tonnes, he said.
"In 2015, the country's palm oil production reached 19.96 million tonnes and in 2016 it is forecast to hit 20.1 million tonnes," he said.
Yusof said Indonesia, the world's largest palm oil producer, will increase its biodiesel mandate to 20 per cent blend and this will create uncertainties in supplies, thus preventing price falls.
For Malaysia, he said, with the full implementation of a seven per cent blend in 2015, biodiesel production was estimated to reach 0.53 million tonnes, up from 359 million litres in 2014.
Yusof said a 10 per cent blend was to be introduced in Oct 1, 2015 but was postponed and this new blend, if successfully implemented, could further spur production to 0.7 million tonnes in 2016.
Its Chief Executive Officer, Tan Sri Yusof Basiron, said the CPO price was expected to be an average of RM2,590 per tonne and will not likely fall below RM2,000.
"The CPO price was traded at an average of RM2,172 per tonne in 2015, went below RM2,000 per tonne and to as low as RM1,975 in August 2015.
"However, it has recovered since then and finished on a high of over RM2,400 per tonne at end-December 2015," he told reporters at the 18th Malaysia Strategic Outlook Conference 2016, themed 'Coping with Uncertainty - The Way Forward in Difficult Times', here Tuesday.
Yusof was one of the panellists at the event organised by Asian Strategy & Leadership Institute.
On a macro level, Yusof said, global palm oil production was expected to be lower than earlier forecast due to the El Nino phenomenon which will affect output.
To tighten supply even further, Malaysia has undertaken a major replanting exercise which will further cut production by as much as 300,000 tonnes, he said.
"In 2015, the country's palm oil production reached 19.96 million tonnes and in 2016 it is forecast to hit 20.1 million tonnes," he said.
Yusof said Indonesia, the world's largest palm oil producer, will increase its biodiesel mandate to 20 per cent blend and this will create uncertainties in supplies, thus preventing price falls.
For Malaysia, he said, with the full implementation of a seven per cent blend in 2015, biodiesel production was estimated to reach 0.53 million tonnes, up from 359 million litres in 2014.
Yusof said a 10 per cent blend was to be introduced in Oct 1, 2015 but was postponed and this new blend, if successfully implemented, could further spur production to 0.7 million tonnes in 2016.