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Malaysian palm oil production to increase to 19.6M tonnes in 2021

Posted by Guilherme Bezzarro

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Malaysian palm oil production is expected to increase slightly by 200,000 tonnes to 19.6M tonnes in 2021, against 19.4M tonnes a year ago, the Malaysian Palm Oil Trade Fair and Seminar 2021 (POTS Digital 2021) heard on 5 January.

This figure was lower than the 19.8M tonnes produced in 2019.

Global supply for 2021 was expected to be affected by the La Niña weather pattern, Malaysian Palm Oil Council (MPOC) CEO Datuk Dr Kalyana Sundram said.

“Disruptions from persistent heavy rainfall in Southeast Asia in 2020 may lead to tight global supply this year,” he added.



Malaysia’s crude palm oil (CPO) exports for 2021 were projected at 4.5M tonnes, with India, the Netherlands, Kenya, Italy and Spain among the key markets.

“Malaysian CPO exports to India in 2021 are likely to stay strong as the current levy on Indonesian CPO export will give a price advantage to Malaysia,” the Edge Markets quoted Kalyana as saying. This was despite the re-imposition of the Malaysian CPO export duty from January 2021.

Exports to India rose significantly after June 2020, following the implementation of a zero CPO export tax from Malaysia, which in turn helped support CPO prices in the second half of last year.

However, palm oil exports to China, which also saw strong demand last year, would be challenged due to lower prices of other oils versus palm oil, said Kalyana.

The total export value of Malaysian palm oil and palm products for 2020 was expected to surpass RM70bn (US$17.45bn), compared with RM67.5bn (US$16.83bn) recorded in 2019, the virtual conference also heard.

Source: Oils & Fats Internacional (OFI)