Additional rains of the possible La Nina weather phenomenon will probably increase yields of palm oil in 2017. Thus, the offer from Indonesia would rise again after a great drought last year.
Weather services predict the beginning of a La Nina weather for the next few weeks that will likely bring much-needed rain in Palm oil plantations in Southeast Asia. The weather phenomenon will bring but in South America, dry weather and limited yields of soybeans there so that the competitive pressure among vegetable oils.
Indonesia and Malaysia produce almost 90% of the world's displaced palm oil. Better yields could come 2017 on the market in the first quarter and after the El Nino effect from the previous year end offering scarce. There is abundant rainfall, 7% to 10% more palm oil on the market will be. Malaysia could provide then in 2017 about 20 million tonnes and Indonesia came with 34 million tons on the market.
This year, the production from Malaysia was only 19 million tons in size, while Indonesia reaped 32 to 33 million tons.
Weather services in Japan and Australia predict a 50 to 70% chance for a La Nina weather; 2016 it will develop in the second half. Palm oil production by 13% (1999) and 10% (2008) compared to the previous year rose earlier La Nina years.
The opposite effect of a drought in South America should provide in 2017 for a smaller soybean crop. That would be for the palm oil producers advantage, because the demand would be better and the prices are rising.
