InfoSAWIT, KUALA LUMPUR –2018 is full of challenge for the crude palm oil (CPO) industries in the world. CEO Felda Global Ventures (FGV), Zakaria Arshad noticed, there might be lack of catalyst to increase the world CPO price. In addition, the CPO production in Malaysia and Indonesia, the two biggest CPO producers in the world would be increasing when the demands are stagnant.
The CPO production in Malaysia might be increasing 4% to be 20,5 milliontonsin 2018. The production of FGVwould be the same, about 5% to be 3,05 milliontonsin this year compared to the production in 2016 that reached 2,88 milliontonsin the same period.
When the production increases, the demands are stagnant. For example, the CPO demands in China, the second biggest importer in the world might not demand it for their domestic stock might be twice to be 550.000 tonscompared to it in 2016 in the same period.
He also said, the other CPO importers, such as, India and Pakistan have lots of stock. “The increasing tariff in India makes CPO more expensive and it is not economical,” he said asInfoSAWITquoted from The Edge Markets last week.
Knowing the condition, he predicted, the CPO might be about RM 2,500 to RM 2,600 per ton to trade in 2018.
The numbers are cheaper than those in the first prediction that reached RM 2,500-RM 2,700. For the seasonal cycle of production in December to February 2018, it is hoped to be the catalyst to increase the CPO price, and also the better currency of Ringgit.(T2)