26/01/2010 (Reuters), Jakarta - Indonesia sees its palm oil exports climbing 16 percent this year on strong market prices, following a 12 percent rise last year as the world's largest exporter looks to tap demand from India and China.

Exports in 2009 were estimated to have risen to 15.5 million tonnes in 2009 as prices climbed last year, from 13.8 million tonnes the year before, data from the Indonesian Palm Oil Association (GAPKI) showed on Tuesday.

The association said exports may continue to rise to about 18 million tonnes this year on good prices, though benchmark Malaysian prices have slipped about 10 percent so far this year.

Average palm oil prices in Asia are set to rise at a slower pace in 2009 and next year as gains from strong global demand are curbed by record vegetable oil output, a Reuters survey showed on Tuesday. [PALM/POLL]

In December Indonesian exports reached 1.505 million tonnes, jumping 21 percent from 1.247 million tonnes shipped out in November as exporters rushed to ship their cargoes to avoid paying a 3 percent export tax in January.

The government will maintain the export tax in February as a measure to safeguard domestic supply and cap the increase in domestic cooking oil prices.

GAPKI is the main industry association for Indonesian palm oil producers. Indonesia relies on overseas markets, mainly India and China, to absorb nearly 70 precent of its palm oil output.

Palm oil's fortunes this year hinge on the buying patterns from these two top consumers, who posted strong economic growth last year, although recent moves by China to tighten credit may slow the pace of demand.