24/2/06 KUALA LUMPUR (Bernama) -- Palm oil could see a boom market later this year and the next spurred by a possible hike in crude oil prices and the fall of the US dollar to 1.05 euro, says the director of Godrej International Ltd, Dorab Mistry.

Currently, the US dollar stands at 1.1926 as against the euro.

"Palm oil prices could go above RM1,600 per tonne next year with strong demand in biofuel," he said at the Annual Palm & Lauric Oils Conference and Exhibition here Friday.

From July onwards, Dorab said demand from traditional markets such as China, India, Pakistan, Middle East and Africa is likely to hold centre stage.

"The outlook for plantations is excellent for 2006-07. The world needs palm oil as never before. The challenge for the industry is to invest in bigger production and to achieve this in an ecologically-sustainable way," he said.

Dorab said while production of most edible oils such as soybean, sunflower oil and canola is on an upward trend, palm oil production in Malaysia tended to be flat in the year immediately following a bumper year last year.

"My estimate is for an increase of only 300,000 tonnes to 15.3 million tonnes (in Malaysia). Indonesia, on the other hand, will expand by 1.3 million tonnes and equal Malaysia at 15.3 million tonnes," he said.

Another speaker, Thomas Mielke, director of Ista Mielke Gmbh, publishers of Oil World, said demand for palm oil is growing faster than production.

"There will be strong demand coming from India with its expected reduction in palm oil import duties this year," he said.

-- BERNAMA