Friday 21 Jun 2024
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KUALA LUMPUR (Jan 12): Malaysia's palm oil export revenue is expected to fall by 24.1% in 2023 to RM102.5 billion, compared with a record RM135 billion posted in 2022, due to normalised crude palm oil (CPO) prices forecast for this year.

Director general of Malaysian Palm Oil Board (MPOB) Datuk Dr Ahmad Parveez Ghulam Kadir at the Palm Oil Economic Review and Outlook Seminar 2023 on Thursday (Jan 12), however, said exports of Malaysian palm oil are expected to increase 3.7% to 16.30 million tonnes in 2023, from 15.72 million tonnes in 2022, attributed to expected ongoing palm oil demand from importing countries.

“CPO production is likely to rise by 3% to 19 million tonnes in 2023, from 18.45 million tonnes in 2022, following an expected increase in mature planted areas, especially in Peninsular Malaysia and Sarawak, better weather conditions as well as improved labour conditions,” said Ahmad.

He added that CPO prices are forecast to settle in the range of RM4,000 to RM4,200 per tonne, compared with RM5,087.50 per tonne in the previous year.

“The key drivers that will influence CPO prices are labour availability, which is still an issue, lower sunflower seed production from Ukraine due to the ongoing war with Russia, and higher imports of palm oil by China as it loosens its Covid-19 rules.

“Other factors include Indonesia’s production of CPO being questionable, its B35 biodiesel mandate, and its tightened export policy,” he said.

Indonesia will kick-start its biodiesel mandate known as "B35" from January 2023, which is likely to be given a stronger boost to Malaysian CPO, he added.

“This latest policy change would further restrict global palm oil supply. Hence, demand for Malaysian palm oil is expected to rise, which will eventually assist in reducing domestic palm oil stocks,” he said.

Malaysia’s palm oil stocks will also likely to fall by 8.75% to two million tonnes in 2023, from 2.19 million tonnes last year, due to an expected increase in export demand, especially from major importing countries.

He added that, for the whole of Malaysia, the monthly net income of independent smallholders based on average farm ownership is RM2,634. Sabah recorded RM4,394, Sarawak registered RM3,189, while Peninsular Malaysia stood at RM2,150.

Edited BySurin Murugiah
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