World number one palm oil producer Malaysia expects production of the commodity to jump 20 percent to hit 20 million tonnes by 2020.

Plantation Industries and Commodities Minister Peter Chin said crude palm oil production this year was estimated at 16.58 million tonnes, up 4.4 percent from 2006.

Malaysia is currently the leading global exporter of palm oil, Chin said according to state news agency Bernama , with neighbouring Indonesia close behind.

"The oil palm industry is currently experiencing rapid growth, especially with the anticipated shortage in global oils and fats output forecast for this year and 2008," Chin said.

Chin said crude palm oil prices would remain high for the next two years. Prices are currently above RM2,000 per tonne.

Indonesian Vice President Jusuf Kalla had said that his country plans to be the largest palm oil producer by 2008 amid strong demand from the global food, bio-fuel and chemicals industries.

Indonesia is currently the second largest producer after Malaysia although it had a much larger area for plantations. The two countries account for 85 percent of world production.