Indonesia's crude palm oil (CPO) production is expected to fall to its lowest level in 13 months in March as a drought caused by an El Nino weather event continues to curb output, according to a Reuters survey. March CPO production could fall for a seventh month in a row to 2.15 million tonnes, according to the median estimate in a survey of three industry associations and one of the country's largest planters.
That would be down from 2.30 million tonnes in February, and the lowest monthly output by the world's top palm oil producer since February 2015. Indonesia's annual palm oil output is expected to fall to about 32.1 million tonnes this year, which would be the first decline since 1998, Indonesian Palm Oil Association (GAPKI) said last month. "Production up to June will remain at low levels due to El Nino. Hopefully with the improvement in rainfall volumes through mid-year, palm fruit production will start to normalise and in August production can start taking off," said Sahat Sinaga of the Indonesia Vegetable Oil Industry Association (GIMNI).
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