Indonesia palm oil sales seen up in 2008 - official

By Mayank Bhardwaj

PANAJI, India (Reuters) - Indonesia is expected to export 14 million tonnes of palm oils in 2008, up from this year's estimated 13 million tonnes, and record a further rise in overall output, a leading trade official said.

Forecast to overtake neighbour Malaysia as the world's top palm oil producer in 2007 with an estimated 17 million tonnes, Indonesian output will rise again next year, said Derom Bangun, chairman of the Indonesian Palm Oil Association.

"We will produce 18.4 million tonnes of palm oil in 2008, which will help us export more," Bangun said on the sidelines of an edible oils conference in India at the weekend.

Malaysia's palm oil output is expected to fall below 16 million tonnes in 2007, according to the Malaysian Palm Oil Board.

An additional 300,000 hectares under palm oil would help Indonesia produce more oils in 2008, Bangun said.

Indonesia has the potential to add 10-11 million hectares to current oil palm plantations totalling about 6 million hectares without damaging virgin forests, M.R. Chandran, adviser to the Roundtable on Sustainable Palm Oil, told Reuters in an interview this month.

Conservationists and scientists have warned that the biodiesel boom is speeding up deforestation in Southeast Asia and South America, as farmers cut down trees to expand palm plantations and soy fields.

But additional output of palm oil from Indonesia may cool a surge in prices, which reached a historic high of 2,764 ringgit a tonne in June due to rising global fever for biofuels.