GAPKI's Hasan@ (Updates with details, quotes)
NUSA DUA, Indonesia, Nov 3 (Reuters) - Palm oil output from Indonesia, the world's biggest grower, will rise to 38.5 million tonnes in 2018 from 36.5 million tonnes this year, said Fadhil Hasan, a board member of the Indonesian Palm Oil Association, or GAPKI, as weather conditions improve and aid fruit yields.
"The weather factor will play an important role in determining production in 2018," said Hasan, referring to the La Nina weather phenomenon that typically brings rains across Southeast Asia.
The rains will help palm oil crops shake off the lingering effects of an El Nino weather pattern in 2015. The El Nino brought scorching heat across Southeast Asia, hitting palm's fresh fruit yields and lowering output.
Hasan, formerly the GAPKI executive director was speaking at an industry conference in Bali, Indonesia. He forecast average palm oil prices in 2018 to range between $710 to $720 per tonne, while crude palm oil prices this year will average between $700 and $710 per tonne on a CIF Rotterdam basis.
"We expect that prices of palm oil in 2018 will be relatively stable... and slightly increase in the first semester of 2018. In the second semester, as main harvest season comes, prices will decline," said Hasan.
Palm prices next year would also depend on other factors such as crude oil, the price difference between palm and soy oil, and the policies of the European Union and the United States toward palm oil.
The EU could push forward a resolution to restrict imports of the vegetable oil, while the U.S. in October set preliminary anti-dumping duties on biodiesel imports from Argentina and Indonesia.
Palm oil is used as feedstock to make biodiesel.
On demand, Hasan forecasts for Indonesian palm oil exports to rise to 29 million tonnes next year from 28 million tonnes in 2017. Domestic consumption is also seen rising moderately in 2018 to 10 million tonnes from 9.7 million tonnes this year. (Reporting by Emily Chow; Editing by Christian Schmollinger)