Palm oil stocks lower

08/04/2009 (The Star Online), Putrajaya - Malaysia’s palm oil stocks for end-March are expected to be lower at 1.5 million-1.51 million tonnes from 1.56 million tonnes in February, said Plantation Industries and Commodities Minister Datuk Peter Chin Fah Kui.

However, local palm oil production in 2009 is expected to reach 18.3 million tonnes, higher than the 17.73 million tonnes in 2008.

He said the lower palm oil inventory in March reflected the effectiveness of the Government’s replanting scheme to encourage planters to chop down oil palm trees over 25 years old.

The Malaysian Palm Oil Board is expected to release the end-March palm oil inventory, production and export figures this Friday.

The drop in end-March palm oil stocks marked a fourth consecutive month of declining stockpiles after it hit a record 2.2 million tonnes in November 2008, Chin told reporters after the official launch of the Malaysian Palm Oil Association’s (MPOA) book on Sustainable Production of Palm Oil – A Malaysian Perspective yesterday.

He said the ministry had approved 1,228 out of 1,276 applications received as at end-March under the RM200mil replanting scheme introduced in late-2008, which allocated RM1,000 per ha for oil palm planters.

The approved replanting applications represented a total area of about 106,330ha, but “we have yet to reach our targeted replanting area of 200,000ha,” Chin said, adding that the approved replanting applications accounted for over RM106mil.

As for the RM100mil replanting scheme under the recent second stimulus package, he said: “The scheme will allocate RM6,000 per ha, which comprise replanting, fertiliser and seedlings for smallholders.”

On a separate matter, Chin said his ministry would not make it mandatory for local palm oil millers to install methane gas trapping facilities and capabilities.

Instead, the Government will try to assist palm oil millers to upgrade their facilities.

To date, it was reported that only 20 out of 406 palm oil mills nationwide are involved in Clean Development Mechanism-related projects involved in methane gas trappings.

On the issuance of more crude palm oil (CPO) export licences, the minister said “we have no plan to issue any more CPO export licences.”

So far, a total of three million tonnes of CPO had been approved for export.

Chin noted that export licences were given mostly to local plantation companies with their own refineries overseas, such as China, the Netherlands and the US.