Головна Horticulture Oilseed Palm oil prices to stay high as fertiliser costs limit output

Palm oil prices to stay high as fertiliser costs limit output

Palm prices are expected to stay strong next year as production will remain constrained due to soaring fertiliser costs and long-standing labour shortages, the Council of Palm Oil Producing Countries (CPOPC) said on Thursday.

This is reported by ProAgro Group citing Reuters.

The sector, which is already facing sluggish yields after farmers reduced fertiliser usage in 2018 and 2019, may again suffer from lower inputs next year.

CPOPC said smallholders are expected to cut down on inputs as prices of nitrogen and phosphate have jumped by 50%-80% since mid-2021, while plantation firms may face challenges due to supply constraints.

“As a result, Indonesia and Malaysia may not be able to deliver much output growth in 2022,” it said. The two countries collectively constitute 85% of the world’s palm oil supply.

Tight supply has already driven up prices of benchmark crude palm oil futures by 31% last year, with the contract hitting a record high of 5,220 ringgit ($1,252.25) a tonne.

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