PETALING JAYA, June 22 (Bernama) -- Malaysian palm oil price is expectedto be higher due to the possible shortage in production of the commodity,Malaysian Palm Oil Association (MPOA) chief executive officer M.R.Chandran said.

"There was room for palm oil price to drop and but as long as we aregetting RM1,700 to RM1,800 per tonne, we should be very happy as this is avery good price." he told Bernama here Tuesday.

Chandran said that there was no reason to panic or be pessimistic as thepeople would be quite happy even if the price was around RM1,500 pertonne.

"We estimated 15.5 million tonnes of production this year but I havedoubts whether we are going to achieve that target," he said.

As for the first six months of 2004, our production has been lower thanlast year and therefore, the chance of meeting the target is much lower,he said.

He believed that Indonesia's production was not going to be as high asfocused earlier.

"Indonesia is expected to produce 11 million to 11.2 million tonnes a yearbut I doubt it very much. I guess it will be about 10.5 million tonnes,"he added.

He said apart from the pending shortage of palm oil, there was alsoconcern over the weather condition in the United States and the productionof soya bean which could swing the price of palm oil.

-- BERNAMA