JAKARTA (TheInsiderStories) – The Indonesian Vegetable Oil Industry Association (GIMNI) projects that crude palm oil (CPO) production in 2021 will grow by around 3 percent to 48.4 million tones (MT) of CPO from this year’ 47 MT of CPO, inline with the increasing of prices and the conducive climate. Crude Palm Kernel Oil production also will increase by about 4 percent from 4.6 MT of CPO to 4.8 MT of CPO in 2021.
Executive director of GIMNI, Sahat Sinaga, also believed that there will be an increases in domestic palm oil consumption by around 14 percent to 19.75 MT of CPO in 2021. Its projected that starting next year, the domestic consumption palm oil for food will be around 8.8 MT of CPO, for non-food items around 1.67 MT of CPO and for biodiesel around 9.2 MT of CPO.
According to him, this increases in biodiesel consumption provided the B30 program was running. While, palm oil exports in 2021 will also increase by 11 percent to 36.7 MT of CPO due to an increase in downstream palm oil product exports by around 16.6 percent to 29.29 MT of CPO. In addition, the CPO exports will experienced a decline of around 8 percent to 7.4 MT of CPO.
The Indonesian Palm Oil Entrepreneurs Association (GAPKI) noted that during the first semester of 2020, the production of Indonesian palm oil and its derivatives was recorded at 23.47 MT of CPO. This figure is lower than the production in the first semester of 2019 which was recorded at 25.88 MT of CPO.
Earlier, the senior economic minister, Airlangga Hartarto, optimistic that the CPO prices in 2021 would be higher than this year. He stated, “Palm oil is expected to experience a slight increase in prices in 2021, to around US$668 per MT from $650 per MT in 2020.”
The triggered are the demand for palm oil is expected to recover and is also driven by the global economy which will be reopen starting next year. Then, sustainability of biodiesel policies in Indonesia also an increases demand by the major trading partners.
Hartarto said palm oil has had a huge impact on the Indonesian economy. In addition, the contribution of these sector to exports values reached $20 billion per year.
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