The country’s growers group says that palm oil output in Malaysia is expected to edge up to 19.4 million tonnes this year, with any damage from a possible El Nino phenomenon likely to be felt only next year.
According to the National Oceanic and Atmospheric Administration (NOAA), El Nino "refers to the large-scale ocean-atmosphere climate interaction linked to a periodic warming in sea surface temperatures across the central and east-central Equatorial Pacific."
Impact felt next year
In other words: warmer water in the Pacific that can disrupt weather patterns, and can induce droughts in some parts of the world, while drenching others.
Reuters reports that meteorology experts say the chances have increased that the weather phenomenon will strike this year and this could lead to a severe dry spell over Southeast Asia where 85% of the world's oil palm is grown.
Palm oil and its derivatives are present in about 70% of cosmetic products and are obtained from the flesh of the fruit.
"Should there be an El Nino in the coming 2-3 months, the impact will be felt early next year," says Makhdzir Mardan, chief executive of the Malaysian Palm Oil Association (MPOA).
Drought
Despite a two-month dry spell earlier this year, crude palm oil production in the world's second-largest grower has so far exceeded estimates, jumping more than 17% in March on a month earlier to 1.5 million tonnes and rising again to 1.56 million tonnes in April.
The drought meant palm fruit growth would wane at the end of the year, the MPOA said. Full-year output was expected to rise only 0.9% to 19.4 million tonnes, from the 19.22 million tonnes produced in 2013.
"The recent drought has caused spear formation on young shoots, which is an indication that leaves are not fully grown," Makhdzir adds.
Indonesia, the world's largest palm oil producer, has also said it is unlikely to feel the impact of any El Nino weather pattern until 2015.