Next Story Malaysia is proposing barter deals with India and China to reduce rising palm oil stocks and keep its market share during a glut.
Analysts say the moves are unlikely to have a long-term impact on the recovery of prices.
If the deals do not go ahead, already low prices will test new depths when the production season picks up in coming months. Malaysia is the world's largest palm oil producer and the government is struggling to reduce the surplus. Previous market intervention and alternative uses for the oil, such as firing power plants, have had limited impact. A feeling of urgency was underscored by visits by Primary Industries Minister Lim Keng Yaik to India and China last week, when he offered the railway projects. Chinese companies may be given a contract for double tracking an existing rail line and talks are also under way with a Chinese company for 20 diesel locomotives.