MALAYSIA MAY NOT MEET 1987 OIL PALM TARGET
Malaysia is unlikely to meet its
targeted output of five mln tonnes of oil palm in calendar
1987, oil palm growers told Reuters.
    Output in 1987 is expected to reach around 4.5 mln tonnes,
unchanged from 1986, because of drought, low use of fertiliser
and overstressed palms, they said.
    The growers were asked for their reaction to an Oil World
newsletter report that Malaysia's oil palm output is likely to
drop sharply this year.
    Palm oil now sells at around 700 ringgit a tonne, or about
115 ringgit less than soybean oil, but Malaysia must sell more
palm oil to prevent a stock buildup that could damage the
industry, a leading grower told Reuters.
    The country's palm oil stocks now total some 500,000 tonnes
against about 800,000 last March, the growers said.
    The growers expect palm oil prices to ease later this year
due to pressure from South American and U.S. Soybean output.
    The current South American oilseed harvest, mainly soybean,
is likely to be around 25.7 mln tonnes against the previous
21.7 mln tonne crop, they said.
    In addition, new U.S. Soybean plantings are also expected
to enter the market around November when Malaysian palm oil
output peaks.
    They said new planting of palms is also likely to slow,
with some 50,000 hectares expected to be planted with new trees
against 100,000 in 1986, although the effects of this reduction
will not be felt for about another three years.
 REUTER
