www.thefinancialdaily.com  Palm deal with Indonesia, the sooner the better Palm oil shortfall to boosts international prices Staff Reporter KARACHI: Sector analysts are expecting a sharp 18 per cent hike in the prices of crude palm oil (CPO) in next few months. This anticipation gained strength after Malaysian crude palm futures were seen trading in 2,800-3,200 ringgit range --after July-- as current El Nino-driven hot weather may dent production in the second half of 2010. Godrej International's head of vegetable oil trading Dorab Mistry said his forecast was within palm oil's most "bullish period" that runs from the second half of 2010 until the first quarter of next year. Pakistan, one of the largest importers of crude palm, may suffer substantially if a Preferential Tariff Pact (PTP) with Indonesia is not realised sooner than scheduled. The new tariff agreement would limit Pakistan's reliance on Malaysia, which has a crude palm export quota of 3 million tonnes. The agreement is expected in June or July this year but experts opine it should be done before the forecasted price hike in June-July 2010. Pakistan is importing 95 per cent of its palm oil from Malaysia which could be reduced to 75 per cent if a pact is signed with Indonesia. Malaysian palm oil output may go into a second year of declines due to the ongoing replanting scheme and the current hotter El Nino weather curbing the development of oil rich female palm flowers that take six months to develop. Mistry believes that a similar situation would prevail in Indonesia as he thinks overall CPO production in Indonesia could rise by 1 million tonnes only. Indonesia has projected 2010 output to rise by 9.5 per cent, or about 2 million tonnes, to 23 million from a year ago.