The current spate of heavy rains in East Malaysia raises the alarm for plantation players here in terms of fresh fruit bunch (FFB) operations as the Malaysian Meteorological Department warns of higher rainfall ahead. Ivy Ng, regional head of plantations and deputy head of Malaysia Research at CIMB Investment Bank Bhd (CIMB Research) told The Borneo Post that the rise in rainfall will reduce crude palm oil (CPO) fresh fruit bunch (FFB) output as workers here will not be able to harvest the fruits. “If the fruits become overripe or if the evacuation of FFBs to the CPO mills is affected, this will definitely impact the quality of the fruits,” she said via email. “Overall, it could reduce the CPO production from the areas affected.” Ng also pointed out that exceptionally high rainfall will also depress oil extraction rates (OER) due to excessive moisture in fruit bunches. Sarawak accounts for 17.5 per cent of total CPO production in Malaysia last year. The Malaysian Meteorological Department on its website yesterday issued a heavy rain warning (orange alert level), warning of intermittent rain occasionally moderate occurring over divisions of Kuching, Samarahan, Sri Aman, Betong, Sarikei, Sibu, Mukah and Bintulu. This is expected to persist until today. Palm oil production in the country tumbled 22 per cent in December, representing its biggest fall in eight years. This slashed palm inventories which dropped to a five-month low of 2.01 million tonnes, according to the Malaysian Palm Oil Board last week. Nevertheless, when asked on her opinion on the price of CPO, CIMB’s NG believes it will remain supported on the back of concerns that production may be negatively impacted by the ongoing monsoon.
Posted on: Tue, 20 Jan 2015 09:31:00 +0000
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