There should be no cause for concern over the hike in CPO production even if its exports were to come under pressure. Domestic CPO consumption is forecast to increase.
Medan, N Sumatra (ANTARA) - The Indonesian Palm Oil Council (DMSI) has forecast the country's crude palm oil (CPO) production to record a slight increase to touch 48-48.5 million tons in 2021, from an estimated 47 million tons this year.

Until September 2020, the country's CPO production had reached 34.41 million tons, DMSI General Chairman Derum Bangun stated during the commemoration of National Palm Oil Day on Wednesday.

"There should be no cause for concern over the hike in CPO production even if its exports were to come under pressure. Domestic CPO consumption is forecast to increase," he explained.

However, he forecast CPO demand in the foreign market to continue to increase, along with the low production growth of other vegetable oils, he noted.

Domestic CPO requirements will remain high owing to the government's program to boost the use of palm oil in the production of 40 percent biodiesel blend fuel (B-40) from fuel with a blend percentage of 30 percent, or B-30, he stated.

"What is certain is that Indonesia must always promote (palm oil) since negative campaigns against palm oil will persist," he emphasized.

Bangun noted that palm oil consumption in India, one of the biggest markets for Indonesian palm oil, had declined up to 56 percent owing to the COVID-19 pandemic and also the negative campaigns.

The vilification campaigns have left most of the country’s households with no choice but to switch to non-palm-based cooking oil, he pointed out.

Bangun forecast that the CPO price in 2021 will stay high, albeit below US$800 per metric ton as recorded in 2020.

The high export price will result from the high demand due to the low production of other vegetable oils, he stated.
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Translator: Evalisa Siregar/Suharto
Editor: Fardah Assegaf
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