In response to simon at quo dot com dot au:
The PHPSESSID is produced using an hash function. By default, it uses MD5 which produces 128 bits long (i.e: 16 bytes long) hashes.
But, since some bytes' values may not be used in the HTTP header, PHP outputs the hash in its hexadecimal representation, thus resulting in a 32 bytes long text.
Starting with PHP 5.0, you can change the hash function used (by setting "session.hash_function" to whatever function you want to use in php.ini).
You may for example set it to 1 to switch to SHA-1 which produces 160 bits (20 bytes) long hashes.
Please also note that another setting was introduced in PHP 5 (session.hash_bits_per_character) which sort of "compresses" the hash. Thus, resulting in what seems to be a shorter hash.
This feature helps you improve your application's security by producing IDs that are harder to prodict for a malicious attacker.
More information on those settings is provided on:
http://www.php.net/manual/en/ref.session.php