Indonesia is expected to keep its ranking as the world’s number one palm oil producing country. Palm oil production is expected to increase 7.8% on average per year between 2011 and 2020, outpacing Malaysia’s projected growth rate of 2.7% and the overall global growth rate of 5.9% according to Frost & Sullivan. Driving this sustained increase in production is an expected expansion of area of cultivation. Indonesia is expected to see a growth of 6.7% per year in planted area equal to 420,000 hectares per year compared to Malaysia’s expected growth of planted area of 3.5% or 150,000 hectares per year. Forty nine percent of Indonesia’s planted area is still under eight years of age – meaning that as more acreage matures, increases in production will be supported for the long term. The Indonesian industry still faces certain hurdles though – increasing production costs, low yields, and consumer demand for sustainability within the industry. To read further how the Indonesian palm oil sector can address these issues:
To receive relevant news stories with summaries provided by GAI Research & Insight, subscribe to Global AgDevelopments, our free weekly enhanced eNews service