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Malaysia Palm Estate Owners See $217 Million Loss If Ops Reduced

Malaysia Palm Estate Owners See $217 Million Loss If Ops Reduced

The Malaysian Estate Owners Association says new virus-related restrictions on palm operations will cause potential losses of as much as 900 million ringgit ($217 million) a month to the oil palm sector in the state of Sabah.

If the entire oil palm supply chain in Sabah is constrained by a recent order to operate at 50% capacity, the state could see crude palm oil, or CPO, production falling by as much as 300,000 tonnes a month, MEOA said in a statement on Saturday.

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At prevailing CPO prices of close to 3,000 ringgit a ton, the estimated loss in revenue could be as much as 30 million ringgit a day, the association said. Palm kernel losses haven’t been factored in, it said.

Sabah is Malaysia’s largest palm oil producing state, accounting for 25% of the total national palm oil output.

©2020 Bloomberg L.P.