11/11/05 JAKARTA ( Asia Pulse) - Indonesia's exports of crude palm oil (CPO) and derivatives are forecast to reach 10.5 million tons in 2006, up from an estimated 9.6 million tons this year, the Kompas daily reported.

The increase in exports will be boosted by growing demand from Europe and the United States to be processed into bio-diesel oil, Chairman of the association of palm oil companies, Derom Bangun told the daily.

In addition, the use of soft oils such as soybean oil tends to decline in the United States for suspected content of trans fatty acid that comes during the process of hydrogenation, Bangun said.

The country's production of CPO is predicted to rise to 14.7 million tons in 2006 from an estimated 13.6 million tons in 2005 and 12.2 million tons in 2004.

Indonesia is the second largest producer of CPO in the world after Malaysia.

(ANTARA)