Seasonal Slowdown in Malaysian Palm Oil

WASHINGTON - Feb 9/07 - SNS -- Crude palm oil (CPO) production in Malaysia sank 26.3% to 1.1 million metric tons (MT) in December due to seasonal downtrend and flood-related problems in the southern part of the Peninsula, according to a recent report from the U.S. agricultural attache for the country.

The Malaysian Palm Oil Board (MPOB) reports output in Peninsular Malaysia decreased by 31% while East Malaysia's production was down by 21%. Compared to December 2005, output during December 2006 was 6.4% higher.

In addition, the CPO output in November was usually high due to the carryover of harvesting caused by the 'End of Ramadan' Festival. The seasonal downtrend is expected to continue to the month of March.

The second wave of flooding in the southern state of Johor in early January caused some delays in harvesting and logistic problems. The bigger estates in the area reported a crop loss of less than one. Since December and January were seasonally low production months, the effect of the flood was minimal.

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