Bloomberg News

Palm-Oil Use Is Seen Rising on Shortage of Vegetable Oil

September 04, 2012

Palm-oil use is expected to climb in the year through September 2013 to compensate for a shortage of other vegetable oils, Oil World said.

World palm-oil consumption will climb to 53.9 million metric tons from 50.7 million tons in 2011-12, the Hamburg-based oilseed researcher said in an e-mailed report.

Palm-oil futures traded in Malaysia have fallen 4.1 percent this year, compared with a 12 percent increase for Rotterdam sunflower oil. Oil World forecasts a decline in production of oil from sunflower seeds, cotton seed and peanuts.

“Global dependence on palm oil will rise significantly in the next 12 months to compensate insufficient supplies of other vegetable oils,” Oil World wrote. “We expect palm oil prices to recover owing to increased export demand.”

World production of eight vegetable oils will climb to 153.4 million tons in the year through September 2013 from 149.9 million tons, led by the increase in output of palm oil, according to the industry researcher.

Palm oil output in Indonesia is forecast to climb to 26.6 million tons from 25 million tons, while Malaysia’s production is predicted to increase to 19.4 million tons from 18.1 million tons, Oil World wrote.

“In Malaysia, yields have started to recover and we expect a much better profitability of the trees in the next 12 months,” Oil World said.

Production of sunflower oil is forecast to fall to 14 million tons from 15.1 million tons, output of soybean oil is seen rising to 42.7 million tons from 42 million tons and rapeseed-oil production will gain to 24.4 million tons from 23.9 million tons, according to the researcher.

To contact the reporter on this story: Rudy Ruitenberg in Paris at

To contact the editor responsible for this story: Claudia Carpenter at

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