13/12/2017 (Nikkei Asian Review) - KUALA LUMPUR (Dec 13) -- Malaysian palm oil producer Jaya Tiasa Holdings expects fresh fruit bunch production to rise this fiscal year to Jun. 30 as bulk of its oil palm trees mature and reach prime yielding age, its chief operating officer said.

Fresh-fruit production growth could accelerate to at least 10% this financial year from 8% annual increase in the past year, Peter Lim told Nikkei Markets. That would help lift the revenue at plantation segment by 10%, he added. About 70%-to-80% of the company's palm trees are now in the prime yielding age of between seven and 12 years, he said.

"We expect our yield per hectare to improve and consequently reduce our cost of production," Lim said.

Crude palm oil prices, meanwhile, will likely average 2,500 ringgit ($613.3) a ton until June next year, he said.

Palm oil futures have fallen to their lowest in nearly six months amid lacklustre global demand and weak production. The most-traded crude palm oil futures contract for February delivery is trading 0.2% lower at 2469 points on Bursa Malaysia Derivatives.

Palm oil inventory surged 16% in November from a month earlier, official data Tuesday showed. Production declined 3.3% to 1.94 million tons month-on-month, while exports fell nearly 12% to 1.35 million tons in November.

Jaya Tiasa has four crude palm oil mills with annual capacity of 1.78 million tons. "It may take two years for us to fully utilise the capacity," said Lim, noting the company currently only handles about 854,000 tons of fresh-fruit bunches. It produced about 1.01 million tons of crude palm oil in fiscal 2017.

Shares of Jaya Tiasa, which have shed 23.23% of their value over the past year, are currently trading unchanged at 1.07 ringgit apiece.