KUALA LUMPUR: The downstream sector in the oil palm industry is facing overcapacity issue, both in Malaysia and Indonesia, according to Sime Darby Plantation Sdn Bhd Senior Vice President Haris Arshad. He said on Tuesday refineries in Malaysia and Indonesia would need to consolidate and reckoned that oil palm refineries should be set up in the importing countries instead. “For every one tonne of fruits produce, there are two tonnes of capacity available.“We are seeing consolidation taking place and capacity should be invested when there is demand,” he said during a roundtable session at the Price Outlook Conference 2017 for Palm & Lauric Oils. Industry expert M R Chandran said that the oil palm production in Malaysia and Indonesia is expected to increase by 11% this year to 65 million tonnes compared to 58 million tonnes last year, boosted by good weather conditions. He, however, said that production expansion in both countries have been slowing down since 2015.

Source: The Star March 07, 2017 05:40 UTC