17/08/2007 (Bernama), BANGI - Palm oil prices, now averaging RM2,500 per tonne, will remain fairly high for sometime to come due to brisk demand from both the food and energy sectors, Malaysian Palm Oil Board (MPOB) director-general Datuk Dr Mohd Basri Wahid said Friday.

"We expect prices to stay at high levels on the back of increased demand from major consumers like China and India as well as Europe for use as feedstock for biofuel," he said at a media briefing on the upcoming MPOB International Palm Oil Congress 2007 (PIPOC 2007) here.

Almost 2,000 participants from 43 countries are expected to attend the much sought after annual PIPOC, to be held here from Aug 26-30.

Dr Mohd Basri said Indonesia's move to impose export taxes on crude palm oil to ensure adequate CPO for domestic consumption plus trans fatty acids (TFA) in soybean oil has led to increased demand for palm oil.

In the United States, palm oil and palm products have become important raw materials in the production of solid-fat formulations such as shortenings and margarines in view of TFA.

"They are no longer using soybean to make margarines in U.S. while some American states are introducing legislation to ban the use of soyoil, a move which favours demand for palm oil," he said.

Looking ahead, Dr Mohd Basri said the prospects for palm oil prices remain bullish owing to the multiplicity of these factors, not to mention some importers facing difficulties in importing palm oil due to the higher prices.

He said the higher palm oil prices would boost palm oil export earnings this year.

For the first seven months this year, the palm export revenue increased to RM21.3 billion compared with RM16.5 billion in the same period last year, he said.

-- BERNAMA