5/5/06 (Reuters)  -  PUTRAJAYA: Malaysian crude palm oil prices are likely to inch closer to RM1,600 a tonne this year as the start of biodiesel production cuts domestic stocks, Plantation Industries and Commodities Minister Datuk Peter Chin said.

“The first biodiesel plant will start operations in July or August. That will deplete existing stocks of palm oil,” he told Reuters in an interview on Wednesday in Putrajaya.

“Assuming that all biodiesel plants start operations as per schedule, we are aiming to produce up to 120,000 tonnes of biodiesel in 2006 and 500,000 tonnes in 2007. The entire amount will be exported,” he added. – Reuters