Palm oil output may miss 2001 target: Gapki
Palm oil output may miss 2001 target: Gapki
JAKARTA (JP): The Indonesian Palm Oil Producers' Association
(Gapki) said on Friday that crude palm oil production might miss
the production target of 7.2 million metric tons this year due to
the draught in several major producing areas.
Gapki chairman Derom Bangun said that the long draught and
uncertain weather in oil palm plantation centers Sumatra and
Kalimantan had disrupted the growth of oil palm fruits.
"We would've reached our 7.2 million ton production target
this year, had it not been for the drought," he was quoted by
Antara as saying.
He said the signs of a decline in production had been noticed
since early this year where production between January and June
had been lower than a year ago.
Derom did not specify the decline.
Derom predicted the uncertain weather condition would continue
until the end of the year.
As the second largest CPO producer in the world, Indonesia is
far behind its competitor, Malaysia, which produces 1.1 million
tons of CPO a month, he said, adding that Indonesia's production
is only about 600,000 tons a month.
The low output was one of the reasons why the government was
considering increasing CPO export duty, currently set at 3
percent, to curb the flow of CPO exports.
The lack of CPO supply had caused the price of cooking oil to
rise, Minister of Industry and Trade Luhut B. Pandjaitan said
earlier.
The domestic shortage, he added, had worsened because the high
rising CPO price in the world market, reaching $345 a ton this
month from an average of $260 per ton last year, had induced more
people to export their products.
"We need to strike a balance between domestic need and
exports, so that cooking oil price would not rise steeply," Luhut
said.
Separately, Minister of Agriculture Bungaran Saragih said that
an increase in export duty was not a good idea at this time.
He said that Indonesian oil palm farmers had suffered from low
prices during the past two years, and that now was the time for
them to reap profits.
"At a time when prices (of CPO) are good, raising export taxes
would only hurt farmers interests," Bungaran said.
The raising export duty on CPO was also counter to the
government's efforts to increase foreign exchange earnings this
year, he added.
In Malaysia, Reuters reported, palm oil futures extended
losses on Friday as players took profits following bearish export
figures for July 1-20 and uncertainties surrounding the release
of key crop data.
At the close, the third-month October contract fell 41 ringgit
to 1,147 ringgit ($301.84) per ton after trading as low as 1,145.
Volume was at 1,791 lots.
In the physical market, July/August crude palm oil (CPO) for
the southern and central regions was offered at 1,155 ringgit a
ton against bids of 1,150 ringgit.
Deals were reported at 1,150 ringgit to 1,155 for both months
and regions.
Among refined products, August/September RBD palm oil was
offered at $322.50 a ton. There were offers for August/September
RBD olein at $347.50, while August RBD palm stearin was offered
at $247.50.
August palm fatty acid distillate was offered at $197.50.
(tnt)