JAKARTA (July 31 2003) : Indonesia's main palm oil producers body revisedup its forecast for 2003 crude palm oil output by about seven percent onWednesday to 9.8-9.9 million tonnes, due to maturing plants and higheryields.

Indonesia Palm Oil Producers Association chairman Derom Bangun alsoforecast that exports in 2003 could improve to 6.8 million tonnes, from arevised 6.3 million tonnes in 2002.

Indonesia is the world's second largest palm oil producer after Malaysia,with both countries' exports buoyed by surging global edible oilsconsumption.

The revised output forecast, up from an initial forecast of 9.2 milliontonnes, was within market expectations that had predicted Indonesia'scrude palm oil production could touch nearly 10 million tonnes this year.

"The increase will mainly be caused by maturing plants which are reachingtheir peak, and young trees are also maturing," Bangun said.

"Because of increasing usage of fertiliser since last year, yield is alsoimproving," Bangun said, adding productivity rose to 3.5 tonnes a hectarethis year from 3.4 a year.

The projected output would depend on favourable weather in the comingmonths, with weather conditions normal so far.

Indonesia, which sells palm oil mainly to India, China and Europe, iseager to boost exports because domestic consumption is stagnant at 3.5million tonnes a year.

The Indonesian Palm Oil Commission said the 6.3 million tonnes of exportswere shipped mainly to India, Europe and China with 1.5-1.7 milliontonnes, 1.5 million tonnes, and 450,000 tonnes respectively.

Rival Malaysia was likely to produce 13-13.5 million tonnes of CPO in2003, traders said, higher than Malaysian government's recent estimates of12 million tonnes.-Reuters