Malaysia, the world's No. 2 palm oil producer, may miss its palm oil output target of 18.1 million tonnes this year due to the current dry weather that can hurt yields, estate owners said today.

Hotter-than-usual weather, due to the resurgent El Nino weather condition, has aggravated the biological stress that the oil palms are experiencing after seasonally higher production in the last quarter of 2009, they said.

Biological tree stress refers to weaker yields after a period of high productivity.

"We are unlikely to hit the government's forecast of an additional 500,000 tonnes of palm oil if the hot weather continues to persist.

"It is difficult to reach," said a plantation owner with holdings in Malaysia and Indonesia.

"This will be the second year of weak production growth in Malaysia."

Estate owners say the dry spell in the Southeast Asian region could extend Malaysia's low palm oil production period

in the first quarter of this year to June.

The dry spell in February will also stunt the development of oil-rich palm flowers that take about six months to mature and produce fresh fruit bunches during the peak production period in the fourth quarter, they said.

- Reuters