El Nino affect in Malaysia likely to impact global palm oil prices.
The recent unseasonal hot and dry weather spells in Malaysia have left indigenous oil palm producers worried. Weather reports have further speculated that this climatic anomaly is a result of the much dreaded El Nino effect.
However, the Malaysian meteorological department dispelled any such speculation. According to the meteorology department officials, the climatic conditions have reversed back to normal in the past two months.
However, the palm oil industry is doubtful about favorable conditions and is bracing for a decrease in rainfall – which they believe is due to oceanic warming.
Palm oil production is a crucial component of the global oils and fats trade and in recent times it has also emerged as the fastest growing edible oil across the globe. Malaysia and Indonesia are two of the biggest global suppliers of palm oil, they account for 51 percent and 34 percent of the world’s palm oil production respectively.
The last time the El phenomenon swept the globe was 17 years back and if history is to be considered, such a phenomenon takes place every 10 to 15 years. If the EI Nino phenomenon actually takes place then it is sure to affect the global supply of palm oil.
Photo Credits: youthfoodmovement