Articles About Business

Palm Production in Indonesia Rising for First Time in 6 Months

Jakarta. Palm oil output in Indonesia, the world’s largest supplier, will probably climb for the first time since September as yields recover from a seasonal decline.

Production may increase 11 percent to 2.1 million metric tons in March from the previous month, according to the median of five industry estimates compiled by Bloomberg.

Exports expanded 4.4 percent to 1.65 million tons, while inventories were unchanged at 2.1 million tons, the survey showed.

Futures jumped to the highest level since September 2012 this month on concern dry weather in Indonesia and Malaysia would cut production in the world’s top growers this year.

Output in Indonesia fell last year for the first time since 1998, reducing supplies of the commodity used in everything from Nestle instant noodles to Unilever soaps.

Yields are lowest in January and February because of growing cycles. “Production typically increases in March from February,” said Joelianto, a Jakarta-based trader at Sinar Mas Agro Resources and Technology, a unit of Golden Agri-Resources.

“The weather should be improving too.” North and central parts of Sumatra are forecast to receive 20 millimeters to 100 millimeters of rain per day between March 18 and 24, according to the Jakarta-based Meteorology, Climatology and Geophysics Agency.

Palm oil futures traded at 2,775 ringgit ($841) a ton on the Bursa Malaysia Derivatives yesterday after reaching 2,916 ringgit on March 11, the highest since September 2012.

The percentage change for exports is derived from the February figure from the Indonesian Palm Oil Association, known as Gapki. Comparisons for production and reserves are based on earlier surveys.

Source : http://www.thejakartaglobe.com/business/palm-production-indonesia-rising-first-time-6-months/

Opinion :

In my opinion, very good if Indonesia has commodity exports of palm oil plantations which annually increases significantly. However, it is too concern would state that continues to happen from this export utilization of forest land acquisitions that are continuous growing alarmingly. That should be a forest area and free from all sorts of industrial forms like this. The impact is like burning forests which resulted in the vastness of the burning forest and it is difficult to put out.

The other of impact is dispute between local residents and companies to each other mutual claims over land ownership. The government should make an effort to not be easily issued permits for the establishment of a company engaged in the palm oil commodity. That way we could have preserved forests to prevent burning forest because Indonesian forest is increasingly critical that we have today.