RI to export 2.3m tons of palm oil this year

RI to export 2.3m tons of palm oil this year

SINGAPORE (Reuters): Indonesia is expected to export up to 2.3 million tons of crude palm oil (CPO) in 1998, Derom Bangun, vice chairman of the Indonesian Palm Oil Producers Association, said yesterday.

"Exports can be up to 2.3 million tons after the export ban is lifted, or to be more cautious, at least two million tons, for this year," Bangun told Reuters at the annual Asia Edible Oil Markets in Singapore.

"The exports will bring US$1.2 billion," he said.

Owing to an El Nino-triggered drought and forest fires last year in Indonesia, the nation's CPO output forecast for 1998 has been lowered to 5.9 million tons from an earlier 6.3 million, he said.

The output is expected to rise to 6.6 million tons in 1999 and 10 million in the year 2004, Bangun said in a speech at the conference earlier.

"We should be able to export five million tons when the output reaches 10 million," Bangun said when asked about the growth in exports.

Indonesia in December banned exports of CPO and its by- products between January and March in a bid to boost supplies and reduce the domestic prices of cooking oil, which have soared because of the tumbling rupiah currency.

Officials have said the three-month-old ban on exports of palm oil would stay in place indefinitely.

Palm oil production, traditionally low in January and February, has started to pick up in March and there should be sufficient supplies for the domestic market by April, Bangun said.

"The government will lift the ban when the output can meet domestic requirements. This is the best way to guess when the ban will be lifted," he said.

In London, crude palm oil cif Europe gained a further $12.50 a ton at the opening of the European vegetable oil market on Thursday, but buyers were around $15 below the asking prices.

Uncertainties over if or when Indonesia will lift its ban on the export of crude palm oil and its by products underpinned the market with the latest reports coming out of Indonesia confusing the situation.