Risks and uncertainties on world palm oil, palm kernel and copra markets

The supply of perennial oilseed crops, like palm palm kernel and coconut, faces two major constraints that ordinary annual oilseed crops face in a much lower extent. The difficulty to reap off productivity gains because of the technical constraints attached to mechanising harvesting, firstly and secondly the exposure to world prices because of strong short term rigidity make altogether perennial crops production very risky. History proves however that supplying vegetable oils like coconut oil and more recently palm oil has encountered a paramount success in countries like Philippines, Malaysia or Indonesia. Focusing especially on the palm oil market, we try in this paper to describe and analyse the nature of the risk prevailing in perennial crops production as well as some successful strategies designed and implemented so far to mitigate such risk. Highlighting the role of the stale in risk coping, the paper concludes on the possible lessons that could be learnt for Africa in the future with a state much weaker than it used to be in South East Asia and a new Lome Partnership more in line with WTO rules.