Malaysia palm oil: Production reduced due to negative La Niña affect

March 18, 2021 - USDA estimates Malaysia 2020/21 palm oil production at 19.6 million metric tons, down 2 percent from last month, but up 2 percent from last year.

Harvested area is estimated at 5.4 million hectares, down 1 percent from last month, but up 1 percent from last year. Yield is estimated at 3.63 tons per hectare, down 1 percent from last month, but up 1 percent from last year.

Continued rains stemming from La Niña is negatively impacting the Crude Palm Oil (CPO) monthly output as workers ability to harvest oil palm has been limited, most notably in the Sabah state.

Sabah is the main producing oil palm state, accounting for 30 percent of total production. It has experienced significant year-to-year monthly output lows. According to the Malaysia Palm Oil Board, Sabah CPO output for the month of January was estimated 17 percent below last year. Since the start of the market year in October 2020, output from Sabah is down 11 percent year to year and 22 percent down from the (October to January) 5-year average.

Overall, Malaysia’s (October to January) CPO output is 3 percent down from last year and down 13 percent from the 5-year average. USDA’s market year for Malaysia palm oil is October through September.