November 16, 2017 / 9:00 AM / a month ago

CORRECTED-UPDATE 1-Sime Darby sees palm holding at 2,600-2,700 rgt/T until yr-end

(Corrects company official’s title in paragraph 2)

* Sime Darby sees palm trading at current levels until end-2017

* Estimates palm fresh fruit production up 6-7 pct on year

* La Nina seen disrupting harvest, but impact minimal - Dass

By Emily Chow

KUALA LUMPUR, Nov 16 (Reuters) - Sime Darby Bhd, the world’s largest palm oil planter by land size, expects crude palm oil prices to trade between 2,600 ringgit and 2,700 ringgit ($622.75-$646.71) per tonne until year-end, a company official said on Thursday.

The company’s fresh fruit bunch production for the 2018 financial year is estimated to grow 6-7 percent from the previous year, Franki Anthony Dass, chief executive officer of its plantations business, told reporters after the release of Sime Darby’s earnings.

Malaysian palm oil futures, down 12 percent this year, were trading at 2,729 ringgit a tonne by 0853 GMT.

The recovery in output follows a decline that began in 2015 when the El Nino dry weather phenomenon cut yields and productivity, and whose impact lingered long after it was over.

While rains from a looming La Nina will disrupt the harvesting process, the impact on Sime Darby’s plantations will be minimal, said Dass.

La Niña, characterized by unusually cold ocean temperatures in the equatorial Pacific Ocean, is linked with floods.

“The La Niña is good for us, you’ll have flash floods here and there which will disrupt the harvesting, but it won’t disrupt the production like what El Niño does,” he said.

The impact on the group would be minimal, said Dass.

“When the rain subsides we can go in and harvest, it’s not flooded all throughout. We don’t have significant labour shortage and we are well mechanized so that helps to keep the harvesting rounds done,” he added.

$1 = 4.1750 ringgit Reporting by Emily Chow; Editing by Manolo Serapio Jr.

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