Malaysia is expecting to see exports of palm oil have risen by 5.6 per cent by the end of 2020, the nation’s government has announced.
The country is the second-largest producer and exporter of palm oil in the world, and has seen increased demand from the likes of China, India and the Netherlands, reports Reuters.
In an economic outlook report released by the finance ministry ahead of the 2021 budget, it also pointed to an exemption to export duties on a number of products.
These include crude palm oil, crude palm kernel oil and refined palm kernel oil, and are thought to help to support export efforts.
No export taxes are being charged on these commodities between July and December this year in a bid to counteract a slump in the use of palm oil worldwide.
Coronavirus measures, such as the closing of restaurants and hotels, have led to a drop in demand for palm oil, which is the most widely used oil in foodstuffs.
The pandemic has compounded issues the sector was having even before the outbreak, after dry weather and smallholders using less fertilizer affected palm oil production in 2019.
A return to higher production is expected for 2021, but the report has not provided estimates on what this might look like.
It added: "Crude palm oil price is projected to remain stable with higher demand following recovery in the hotel, restaurant and catering operations, as well as higher biodiesel mandate in Indonesia and Malaysia."
A drop in prices for biodiesel was also seen earlier this year as a result of the pandemic, but have rebounded to be up by six per cent on what they were at the beginning of 2020.