Jakarta: Chemical tanker owners in the region are bracing themselves for a possible cut back in palm oil exports as a drought earlier this year in Indonesia and Malaysia is likely to be followed soon by possible bad weather from El Nino. The two countries account for around 85% of global palm oil production. Analysts are warning that a severe El Nino could see production drop 30% in 2015.
Moreover, a rise in palm oil prices, which tends to happen whenever bad weather hits these two countries, could boost alternative products, especially soybean oil, which is mainly grown in the US and Brazil. [12/05/14]