Malaysia consumes CPO to curb price drops

05 August 2008 09:41  [Source: ICIS news]

SINGAPORE (ICIS news)--The Malaysian government intends to consume crude palm oil (CPO) from its growing inventories in order to manufacture palm methyl ester (PME) in an attempt to halt the downward slide in CPO prices, a senior government official said on Tuesday.

 

Local media reported Peter Chin, Malaysia’s Plantation and Commodities Minister, saying the country would consume around 500,000 tonnes of CPO over the next two to three months in order make biodiesel from its growing inventories, in order to curb further drops in CPO prices.

 

CPO futures have fallen below ringgits (M$) 2,800/tonne ($856/tonne), a far cry from its historical high of M$4,486/tonne just five months ago.

 

Malaysia remains the world’s largest seller of CPO, with export values representing more than 10% of the country’s total exports.

 

($1 = M$3.27)

 

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By: Jeremiah Chan
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