CPO price rise expected: Industry<\/p>\n
Adianto P. Simamora, The Jakarta Post, Jakarta<\/p>\n
Crude palm oil (CPO) prices are expected to rise between 10
\npercent and 15 percent in the remainder of the year due to a
\ncombination of lower output and the increase in demand, according
\nto the Indonesian Palm Oil Producers Association (Gapki).<\/p>\n
Association chairman Derom Bangun told The Jakarta Post on
\nMonday that palm oil yields normally drop by ten percent in
\nNovember and seven percent in December, while demands for the
\ncommodity will increase in the months ahead of the year-end
\nfestivities.<\/p>\n
Bumper harvests for palm oil normally occur in September and
\nOctober, according to Derom.<\/p>\n
\"Thus, the price increase is a normal thing to happen at the
\nend of every year,\" Derom said.<\/p>\n
Derom said the price of cooking oil will also increase at the
\nsame percentage in the coming months because of the increase in
\nthe CPO price.<\/p>\n
Derom also said the CPO price on the international market had
\nincreased to between US$290 and $330 per ton over the past two
\nweeks due to a rise in demand from India.<\/p>\n
\"This increase was due to the high demand from India ahead of
\nthe Hindu Dewali holiday as well as profit-taking action launched
\nby Malaysian traders,\" he said.<\/p>\n
The rise in CPO price on the international market usually
\nresults in an increase in the country's CPO exports. This will
\nmake local CPO stock drop and force cooking oil producers to
\nraise the price of their products.<\/p>\n
If this happens, the government normally raises CPO export tax
\nto curb CPO exports and prevent a sharp increase in cooking oil,
\nespecially prior to major holidays, such as Ramadhan and
\nChristmas.<\/p>\n
Derom, however, expected the government to not raise export
\ntax for CPO, citing that the current palm oil price was still
\nvery low compared to the pre-crisis price.<\/p>\n
\"This price hike will benefit local farmers,\" he said, adding
\nthat the current increase in the CPO price will provide chances
\nfor farmers to offset losses they had suffered during the low
\nprice over the past two years.<\/p>\n
Indonesia, the world's second largest palm oil producer after
\nMalaysia, has targeted to produce 7.2 million metric tons of palm
\noil this year, up from 6.5 million tons the previous year.<\/p>\n
Malaysia, the world's biggest exporter and producer of palm
\noil, accounts for half of the world's supply with an annual
\noutput of 10.8 million tons.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/cpo-price-rise-expected-industry-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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