Vol. 25 (1) March 2025 – OPIEJ

MALAYSIAN PALM OIL PRICE PREDICTION USING ARIMA – ARCH MODEL

mpob_admin — Tue, 04 Mar 2025 05:55:33 +0000

Palm oil is one of Malaysia’s primary industries. In 2022, Malaysia was responsible for 25.14% of global palm oil production, totalling 18.55 million tonnes, and 31.65% of worldwide palm oil exports, amounting to 15.71 million tonnes (MPOB, 2024; Trend Economy, 2024). This article presents a study for Malaysian palm oil price forecasting using the traditional time series model, with three objectives, to identify the behaviour of palm oil prices in Malaysia, to determine the best model for predicting palm oil prices using the ARIMA model, and to perform a short-term forecast of the future palm oil price in Malaysia. The analysis was conducted using monthly Malaysian palm oil prices for a period of 10 years, 2013–2023. EViews software was used to run the data analysis. It is found that ARIMA (1,1,4) – ARCH (1) model is the most parsimonious model for forecasting the crude palm oil prices in Malaysia. Overall, predicting the monthly price of Malaysian palm oil provides valuable insights that support decision-making across the entire palm oil value chain, from producers and traders to
policymakers and investors.

COMPARISON OF 2023 PRODUCTION COSTS BETWEEN HYBRID OxG AND Elaeis guineensis CROPS IN COLOMBIA

mpob_admin — Fri, 20 Dec 2024 10:42:29 +0000

The area planted with Elaeis oleifera x Elaeis guineensis hybrids (OxG hybrids) crops in Colombia is on the rise and nowadays more than 90 000 ha (10% of the cultivated area in Colombia) are currently planted with them. Today, after 15 years of commercial operations of OxG hybrids, there is a set of management practices that includes artificial pollination, harvesting of fresh fruit bunches (FFB) by implementing appropriate ripeness criteria for each type of OxG cultivar, adjustments to OxG nutrition programs and adjustments to the oil extraction process from OxG FFB. This set of OxG crop management practices is the result of years of research by CENIPALMA and, technological adoption by Colombian companies that have pioneered the planting of OxG hybrid cultivars. The adoption of OxG crop management practices has led to the production of an average of 30 t FFB/ha in mature crops, which is higher than FFB production obtained in E. guineensis crops. The results of this analysis allow us to conclude that the OxG hybrid business is currently viable with a unit cost of production of USD102.22/t of FFB [and USD507.90/t of crude palm oil (CPO)], very close to that obtained in E. guineensis cultivars of USD107.65/t of FFB (and USD510.03/t of CPO). Our analyses also yield that cropping OxG hybrid oil palms is a better economic alternative than cropping E. guineensis oil palms. Presenting results on the estimation of unit costs for OxG crops is relevant because the palm oil agri-business from OxG hybrids is a relatively recent development.

PALM OIL PRICE REVIEW AND OUTLOOK 2024

mpob_admin — Mon, 11 Nov 2024 04:18:00 +0000

This article reviews the palm price movement in the first four months of this year and presents a price outlook for the rest of the year. This article identifies and explores the underlying price drivers of CPO futures and cash prices by exploring related palm fundamentals and relevant external variables. Crude palm oil (CPO) futures on Bursa Malaysia have been on a rising trajectory since the start of this year rallying from RM3661 (USD774)/t in January, accelerating to a peak of RM4407 (USD932)/t at the beginning of April, or up RM746 (USD158) or 20% in the three months. Prices took a turn after testing the high of RM4407 (USD932)/t, decelerating rapidly to RM3818 (USD808)/t towards the end of April or down by RM492 (USD104) or 11% in the space of four weeks. Overall year-to-date ending 30 April active month CPO futures averaged RM3989 (USD844)/t or just RM76 (USD16) or 2% higher than the same period last year reflecting a steady to marginal increase in prices compared to last year. This article will address the main factors in understanding the dynamics of CPO futures pricing behaviour by discussing the main fundamental price drivers for the rest of the remaining part of this year.