Palm oil mills are still marketable

381960249_602Development of palm oil mills in Indonesia began in 2001 is expected to tend to increase along with the continued increase in world crude palm oil consumption in 2000 amounted to 20.645 million tonnes and production amounted to 19.962 million tonnes and continued to increase until 2010, when world crude palm oil consumption is expected to reach 29 million tons with production reached 28.571 million tons.

From the projection of world crude palm oil production when compared with its needs are still there is a large market opportunity. Meanwhile, CPO demand in the country, both CPO and PKO until today generally can be met from domestic production. Under these conditions means the market opportunities both domestically and to export up to now is still pretty good, this shows that the prospect of building the capacity of 60 tons of IBS / hour palm oil mills are still quite good and in terms of marketing to be marketable.

By looking at the development area, production and potential new opening new areas of oil palm plantations as described previously, the opportunity to develop oil palm plantations and oil palm processing plant now and the future still has a good prospect. But this must be supported by all parties, especially related institutions and facilities in terms of funding from banks.

To support this industrial sector, the Government of Indonesia still needs to created special regulations to condition for CPO can be processed into the final results in the country. Regulation is needed to prevent the escape of CPO Indonesia to Malaysia, and then exported as a product of Malaysia. As Indonesia’s main competitor, Malaysia with exports valued institution is superior in being able to organize the CPO market quality products to importers lobbied state. Conditions like this will harm Indonesia’s CPO marketing positions in the markets of potential.

Malaysia can do a re-export of Indonesian CPO to claim as their product. If this happens Indonesia will have difficulty in penetrating new markets of the world, because it has been flooded with Malaysia. Demand for oil palm seedlings in Indonesia in 2005 reached 500 million sprouts.

While oil palm seedling production capabilities excel in Indonesia per year maximum of 90 million. Number of opening a new oil palm plantation since 2004 caused demand superior soaring oil palm seedlings. With the supply of sprouts that size, large companies will have difficulty in terms of procurement of oil palm seedlings, so they would not want to import palm sprouts from the outside. In the face of fluctuations in CPO prices, the companies engaged in the business sector should be able to export crude palm oil with a minimum contract period of 6 months. This needs to be done in order to maintain the company’s performance, especially when the CPO price has decreased.

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