Malaysia’s palm oil exports are forecast to be a four-year low in 2014 partly because of dry weather and also due to a shortage of labor, Oil World said.
Exports will be 17.2 million metric tons, down 1 million tons from last year, the Hamburg-based researcher said in a report. Yields will decline to 4.26 tons a hectare (2.47 acres), the lowest since 2010, it said. Malaysia is the biggest producer of palm oil after Indonesia, according to the U.S. Department of Agriculture.
“It is quite alarming that palm oil yields are set to decline for the third consecutive year,” Oil World said. “Weather conditions can only partly be blamed for this development. It is also indicated that there is an increasing problem with the growing share of old trees having surpassed the optimal age as a result of insufficient replanting.”
Malaysia’s palm oil production will climb 0.9 percent to 19.4 million tons this year, according to the report. The first effect of reduced rain in January to April will probably show up in September-December, when crude palm oil production is seen falling below year-ago levels, Oil World said.
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Source : Bloomberg