The contribution of CPO by palm oil producers in Malaysia and Indonesia to the total production of vegetable oils in the world has increased considerably in the past several years. Similarly, the contributions of other vegetable oils producers around the world are also equally important. We utilise our model based on: Beginning stocks + Production + Net import = Ending Stocks +Consumption, which will give the Stock Usage Ratio (SUR) and will be the basis to determine the demand and price forecast. The SUR is also a useful indicator to measure the amount of surplus in stock that can be carried forward to the next year, thus determining the number of days or months the surplus will be able to support the population based on current demand.

We forecast that although demand from certain regions may actually decline, the shortfall will be made up from other traditionally strong consumption regions, especially in Asia Pacific and Middle East. New markets in the African continent will also spur the demand for 2011. Production is also forecasted to increase due to higher yields projected due to better weather conditions.