RI eyes 8% rise in next year’s CPO output

Indonesia, already the world’s biggest producer of palm oil, expects output to remain strong due to continued rising palm oil prices that are boosting the appetites of farmers and private companies to plant the commodity. Achmad Manggabarani, director general for plantations at the Agriculture Ministry, told a forum that next year Indonesia would produce 23.2 million metric tons of palm oil, 8% higher than an estimated 21.5 tons in 2008. “The government predicts the 2020 target can be achieved if Indonesia has 9.1 million hectares of palm oil plantations, with each hectare producing 4.5 kilograms,” said Achmad. Bloomberg reported that palm oil futures on the Malaysia Derivatives Exchange have increased by 32% this year as demand rose on expectations of a global economic recovery. That alone would require 46.11 million tons of biofuels in 2020,” said Ahmad, adding the demand for crude palm oil (CPO) derivatives would also reach 10 million tons by 2020. Palm oil farmers own more than 41% of the country’s total oil palm plantation areas, yet most of the plantations have relatively low productivity levels, estimated at 2.5 kilograms per hectare. (July 1, 2009)