Crude palm oil exports may reach 1 million tonnes this year, up from 919,000 tonnes last year, driven by a higher supply of oil palm and strong demand from India and China, according to the Commerce Ministry.
Wattanasak Sur-iam, director-general of the Internal Trade Department, said the ministry plans to increase crude palm oil exports this year as much as possible to maintain the stability of prices in the domestic market.
Mr Wattanasak cited a forecast by the Agricultural Economics Office that estimates fresh palm nut production at 18.9 million tonnes this year, up 3% from 18.4 million in the 2022 season, with crude palm supply increasing to 3.15 million tonnes for domestic consumption and export, up from 3.14 million tonnes last year.
Oil palm plantation areas are estimated at 6.2 million rai this year, up from 6.15 million rai in 2022.
Relatively good prices in 2022 encouraged farmers to convert their unused land or change to growing oil palm from other crops, according to the report.
He said the ministry set a goal to raise outbound shipments of crude palm oil to 80,000 tonnes in February, up from 37,000 tonnes in January.
Crude palm oil exports rose 57% last year to 919,000 tonnes, with the value increasing by 90% to 45 billion baht.
India was Thailand's main export market, followed by China. India consumes up to 8 million tonnes of crude palm oil a year.
Given the abundant supply, Mr Wattanasak said the department may propose the government adjust the country's safety stock requirement for crude palm oil to 250,000 tonnes, down from the regular level of 300,000.
The domestic price of fresh palm nuts is now quoted at 5.10 baht per kilogramme, higher than the guaranteed price set at 4 baht per kg under the state-sponsored income guarantee scheme for oil palm farmers.
According to an Agricultural Economics Office forecast, global oil palm prices are likely to drop this year, based on higher global supply.
Global palm oil production was estimated at 75.9 million tonnes in the 2021/22 harvest season, up 4% from 73 million tonnes the previous season.
Thailand is the world's third-largest palm oil producer behind Indonesia and Malaysia.
Indonesia was estimated to produce 45.3 million tonnes of palm oil in the 2021/22 season, up 4.14% from 43.5 million tonnes the previous season, while Malaysia was forecast to produce 18.1 million tonnes, up 1.68% from 17.8 million tonnes the season before.
The two countries control 83.6% of the world's palm oil production.