CPOPC SEES PALM OIL BIODIESEL DEMAND UP BY 5 MLN TONNES IN 2020, PUSHING UP PRICES

KUALA LUMPUR, Oct 31 --  The Council of Palm Oil Producing Countries (CPOPC) sees the demand for palm oil-based biodiesel increases by five million tonnes next year that will move prices upward, said its executive director Tan Sri Dr Yusof Basiron.

 He said the production of biodiesel was also seen as an important opportunity to further develop the palm oil industry, add value and increase employment while providing price stabilising tool through rationalisation of stock/supply.

“The implementation of B30 programme in Indonesia and B20 in Malaysia next year will consume 11 million tonnes of palm oil,” he said in his presentation slides at the 15th Indonesian Palm Oil Conference and 2020 Price Outlook.

Yusof noted that the supply of palm oil would increase by 2.5 million tonnes in 2020, but the increase in the demand for palm oil biodiesel by five million tonnes would help create a balanced market.

“By 2025, deforestation is no longer an issue against palm oil, while supply will not be keeping pace with demand and prices will be more remunerative for the producers,” he added.

He said CPOC projected that deforestation-free palm oil would become the norm and oversupply was managed with stronger biodiesel programme.

This would present producing countries with great opportunities to keep on producing palm oil to meet the need of the ever-expanding demand, said Yusof.

“Producer countries need to increase the yield of palm oil to increase supply as the expansion of planted areas will be restricted,” he said.

Both palm oil-producing countries – Indonesia and Malaysia - have limited the expansion of oil palm cultivation involving new land and have pledged to continue to conserve more than 50 per cent of their respective countries’ land area as permanent forests.

Established on Nov 21, 2015, CPOPC is an intergovernmental organisation for palm oil-producing countries.

Indonesia and Malaysia are the founding members of the council, while Colombia joined as the third member in 2018.

-- BERNAMA