Last year I thought this  might be an excellent venue for investment here in Panama.  I am glad I did not jump on that bandwagon.   It may take time for this industry to recover.

As with other forms of alternative energy, high oil prices in the past boosted investment in oil palm plantations as a basis for the manufacture of biodiesel.

In Central America there are a lot of people who turned towards a highly promising sector, promising even more performance than any other crop. Palm expanded not only where there are good conditions to grow it, but it was also substituted for other crops or herds areas offering lower yields.

The current price of a barrel of oil is $48.53, makes for a bad situation for palm producers, who had been expanding aggressively, and who are now seeing a drop of about 20% in the price of oil they produce. An article in Nacion.com reports that “… In March this year, the monthly value was $607.65 per metric ton and last August it dropped to $484.68 a ton, according to the website Index Mundi. ”

For example: “… in 2011, Costa Rica had 60,000 hectares of the crop and last year closed with 77,750 hectares, according to the Executive Secretariat of Planning of the Agricultural Sector (Sepsa) at the Ministry of Agriculture and Livestock (MAG). “