MPOB lowers CPO output forecast

WARNING : This is posted for reading purposes only NOT to be followed seriously. Fundamentally CPO is overvalued above RM2800
Speculations aplenty >>> bewarned !
CAVEAT EMPTOR (Buyers Beware)

The Malaysian Palm Oil Board (MPOB) has lowered its crude palm oil (CPO) output forecast for this year to 17.6 million tonnes from an earlier forecast of 18.1 million tonnes, as the industry experiences lower oil extraction rates.

"Heavier-than-usual rains have disrupted harvesting and lowered palm oil extraction rates," said MPOB director-general Datuk Mohd Basri Wahid.The revision means Malaysia's palm oil output is stagnating at 17.6 million tonnes for the third straight year, while Indonesia continues to see rising production.

The Malaysian Palm Oil Association and Sarawak Oil Palm Plantation Owners Association had complained of acute shortage of harvesters, resulting in lower oil output and export opportunity loss of some RM10 billion a year.

Oil palm planters have also appealed to the government to allow for more flexibility in the hiring of skilled harvesters from Indonesia.

In response, Mohd Basri said the Cabinet is still deliberating on the country's foreign worker policy.

Meanwhile, he encouraged planters to use the MPOB-patented motorised sickle, called Cantas."There is a RM1,000 subsidy for the purchase of Cantas. Its retail price ranges from RM2,500 to RM4,500 per unit. A harvester using the Cantas is able to cover 50ha every month," he said.

On replanting efforts initiated in 2008, Mohd Basri admitted that the execution of the plan to replace unproductive trees with higher yielding ones was slow. So far, the exercise has only achieved 70 per cent, or 139,000ha of its 200,000ha replanting target.

The current high CPO price of RM2,700 per tonne has most probably prompted some planters to delay chopping down their old trees.The MPOB can use RM200 million from a price stabilisation fund to give back RM1,000 per ha to smallholders scheduled to replant their unproductive trees.

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