https://opiej.mpob.gov.my Oil Palm Industry Economic Journal Thu, 21 Mar 2019 05:12:58 +0000 en-US hourly 1 https://wordpress.org/?v=7.0 https://opiej.mpob.gov.my/an-analysis-of-crude-palm-oil-production-in-malaysia/ Tue, 28 Aug 2018 14:25:00 +0000 https://opiej.mpob.gov.my/?p=324 Read more]]> Palm oil is a very important commodity in Malaysia, and as such, it has become one of the 12 economic sectors under the National Key Economic Areas (NKEA) to realise the country’s vision towards attaining a high income nation status in 2020. However, land is a limited resource for future oil palm expansion, thus, land productivity is pivotal in achieving the target of the NKEA. This can also affect future production of palm oil. Thus, it is the objective of this article to understand its behaviour in the past in order to determine its trend in the future. Based on historical data, palm oil production behaviour can be characterised by four components, namely trend, cyclical, seasonal and irregular components. The cyclical component is less obvious due to the nature of the data which is on monthly basis. However, this monthly data is suitable for exhibiting the seasonal and trend components. The seasonal component produces significant monthly indices which show performance of monthly production in a year. The trend component shows that production of palm oil is generally on the uptrend. The last irregular component indicates the production behaviour which is not described by the other three components and is considered a totally random error. Having understood the production pattern which consists of the four components, various key factors (mostly biological in nature) which affect and determine the movement of the palm oil production were also discussed in this article. These factors include rainfall (which affects more on the fresh fruit bunches yield), matured areas and fertiliser application. Coupled with the four components, they give a clearer picture of the production pattern of crude palm oil production in Malaysia.

]]> https://opiej.mpob.gov.my/the-economic-impact-of-the-north-east-monsoon-and-la-nina-on-oil-palm-production-in-malaysia/ Tue, 28 Aug 2018 14:23:42 +0000 https://opiej.mpob.gov.my/?p=322 Read more]]> La Niña, which occurs during the north-east monsoon season, normally brings higher rainfall than during normal weather in Malaysia. This study shows that La Niña had caused flooding in some oil palm planted areas in the past. The floods in effect disrupted harvesting and collecting activities and fresh fruit bunches (FFB) on the oil palm left overripe or become rotten. Crude palm oil (CPO) production declined and reduced income of oil palm growers. The potential losses of FFB by oil palm estates during La Niña in 2010 and 2011 were estimated to be about 239 181 t and 224 776 t respectively. In term of potential income losses, they were estimated at RM 155.10 million and RM 168.22 million during the two years. One of the reasons for the increase in the cost of FFB production was the damage of infield roads during floods. Hence, floods affected estates had spent RM 25.80 million and RM 26.48 million to repair the roads in 2010 and 2011 respectively. This study also showed that CPO production depends negatively with a dummy variable used to proxy La Niña. In the absence of La Niña, CPO production in 2010 should have been around 17.60 million tonnes when the actual CPO production during the year registered at only 16.99 million tonnes. The total potential CPO production loss was estimated to decline by 3.5% and 2.2%, as compared to production without La Niña in 2010 and 2011 respectively.

]]> https://opiej.mpob.gov.my/supply-and-demand-performance-for-the-oils-and-fats-industry-in-malaysia/ Tue, 28 Aug 2018 14:21:52 +0000 https://opiej.mpob.gov.my/?p=320 Read more]]> Malaysia was the world’s second largest palm oil producer, but it was the leading exporter of the oil in 2011. The country had exported nearly 18 million tonnes of palm oil, 3.4 million tonnes of palm kernel oil, 2.2 million tonnes of oleochemicals, 0.4 million tonnes of finished products and nearly 0.3 million tonnes of other palm-based products. Meanwhile, the imports of edible oils and fats, including palm oil had nearly doubled from 1.1 million tonnes in 2005 to 2.1 million tonnes in 2011. Imports of palm oil had grown from 26% in 2005 to 61% in 2011, while imports of palm kernel oil had tripled over the same period. Imports of soyabean, canola/rapeseed and sunflower oils had increased, with their total combined volume increasing to 0.26 million tonnes in 2011 from 0.16 million tonnes in 2005. Only the import of coconut oil had declined from 0.24 million tonnes in 2005 to 0.16 million tonnes in 2011. This scenario indicated that palm oil still played a major role in the demand performance of edible oils and fats in Malaysia. However, arising from higher disposable income and traditional taste preference for premium soft oils, the demand for soyabean, canola/rapeseed and sunflower oils have seen increases in their consumption patterns in recent years.

]]> https://opiej.mpob.gov.my/the-growth-and-prospects-for-the-oil-palm-plantation-industry-in-indonesia/ Tue, 28 Aug 2018 14:19:38 +0000 https://opiej.mpob.gov.my/?p=318 Read more]]> This article provides a historical political economy perspective of the Indonesian oil palm plantation sector. It aims to shed light on the process of how Indonesia took over from Malaysia in becoming the world’s current largest producer of palm oil. This article argues that the regional trend of state-led development that relied on agribusiness as a major sector played a major role in the development of oil palm as an important crop in the region, especially in Malaysia and Indonesia. Indonesia specifically promoted and encouraged the expansion of oil palm as a way to fulfill state developmental aims; identifying it as a lucrative source of revenue, foreign exchange, and rural employment. With oil palm playing such an important role in the Indonesian economy, the state has outlined plans for rapid area expansion, to maintain its world dominance in the sector. Malaysian and Singaporean companies are currently major players in the Indonesian oil palm plantation sector, and continue to reap the benefits of this lucrative crop alongside local firms.

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