Malaysia, the world's second-largest producer of palm oil, is facing a perfect storm of production headwinds that will likely drag global stocks to their lowest level in five years. Malaysian Palm Oil Board data shows a drop in average crude palm oil yields to 1.41 tonnes per hectare, from 1.56 tonnes over the same period last year. However, operations at palm oil mills, where the palm fruit is converted into crude palm oil, have been impacted by COVID-19 restrictions, said Dorab Mistry, director of Indian consumer goods company and major consumer Godrej International. "We have multiple issues with edible oil supplies worldwide, palm oil in Malaysia, canola in Canada and La Nina curbing soybean output in South America," Mistry said. The price pressure may continue as higher edible oil costs are passed on by suppliers, leaving consumers with little choice but to pay up for the staple.

Source: The Star September 05, 2021 01:30 UTC