RI likely to be biggest plam oil producer
RI likely to be biggest plam oil producer
Claire Leow, Bloomberg/ Jakarta
Indonesia may overtake Malaysia as the world's biggest palm
oil producer because it has more land to expand plantations, said
Benny Tjoeng, president director of PT Astra Agro Lestari.
Indonesia has six times more arable land than Malaysia, of
which 5.2 million hectares is planted to oil palms. Malaysia is
growing the crop over 3.9 million hectares, Tjoeng told a palm
oil producers' conference in Bali. Astra Agro is Indonesia's
largest publicly traded plantation company.
"Consumption of vegetable and animal oils has risen every year
in the last 25 years, at a compound annual growth rate of 4
percent a year," to an estimated 21 kilograms per capita this
year, Tjoeng said. "Palm oil consumption has grown 10.6 percent
in the same period. The potential is clear."
Indonesia wants to alleviate rural poverty in a country where
more than half the 238 million people live on less than US$2 a
day, a measure of poverty by the World Bank. It has expanded oil
palm cultivation 86 percent from a total of 2.8 million hectares
in 1998, according to government data.
Still, Malaysia produces more palm oil because it has more
mature plantations and yields are higher at 3.9 tons per hectare
on average compared with 3.4 tons in Indonesia, Tjoeng said.
Malaysia shares a border with Indonesia on the island of Borneo.
Indonesia can lift crop yields by allocating more land to oil
palms, Tjoeng said.
Malaysia and Indonesia produce 80 percent of the world's palm
oil, crushed from an oversized pineapple-like fruit and processed
into oils used in cooking, packaged foods and in toiletries such
as shampoo and soap. China, India and Pakistan are the world's
largest consumers of the oil.
Indonesian palm oil is traditionally cultivated in Sumatra and
Kalimantan provinces. Malaysia's crops are mostly from Sarawak
and Sabah states, on the northern part of Borneo island where
Kalimantan is also located.
Indonesia's palm oil output may rise 11 percent to 13.6
million tons this year, the Indonesian Palm Oil Producers'
Association has said. The Malaysian Palm Oil Association has
forecast production of 14.9 million tons for this year.