KUALA LUMPUR: The yearly growth rates of palm oil production are slowing down, dropping by 30 per cent on average from 2011 to 2020 compared to earlier years, according to United Plantations Bhd vice chairman and chief executive director Datuk Carl Bek-Nielsen.
"This decline is expected to continue, with another 18 per cent drop projected from 2024 to 2030.
"Instead of increasing steadily each year, from 2010 to 2020 by 2.9 million tonnes, we are now looking at a lower figure of around 1.7 million tonnes."
Bek-Nielsen said this in his presentation at the CEO Roundtable: Forging a More Resilient and Sustainable Economic Future for the Palm Oil Industry at the 35th Palm & Lauric Oils Price Outlook Conference and Exhibition here today.
It is understood that when growth rates decrease in the palm oil industry, it can affect profits, jobs and prices.
Another long-standing problem for the past 25-30 years is the growing gap between the best and worst palm oil yields.
"Yields will remain limited until replanting is sped up," he added.
Palm oil's contribution to yearly growth per decade is diminishing, dropping from 47 per cent to a projected 33 per cent.
"This will greatly impact the supply," Bek-Nielsen cautioned.
He also highlighted the palm oil industry's efforts in adopting sustainable practices.
"The push for sustainability has significantly reduced deforestation, especially in the palm oil sector.
"Deforestation rates have dropped sharply. In fact, the total area of mature oil palm plantations in Malaysia has slightly decreased over the last three to four years," he noted.
"This is crucial. To give you an idea, the area lost to deforestation is less than the total palm oil plantation area in Malaysia over the past 118 years," he added.
However, there are some who seem disconnected from reality and continue to set unrealistic standards.
"They are unaware of reality, blindly following impractical goals.
"Continuously raising the bar too high will make it impossible for 75-80 per cent of global palm oil producers to meet these sustainability standards," he said.