Higher Income in Higher Income Economy Model?????
Assalamualaikum w.b.t.,
AAAAHHHAAAAA!!!!!
It is also about subsidy again??? Will cook oil price up again???
Wassalam.
-----
By HANIM ADNAN
PETALING JAYA: Anticipation over declining crude palm oil (CPO) production due to ageing plantations in major producing countries including Malaysia, would likely bolster the commodity to hit RM4,000 per tonne by second half of this year, according to industry players.
Malaysian Estate Owners Association president Boon Weng Siew who pegged the country's total planted area with palm trees of over 20 years old to between 30% and 40%, said many of the ageing palm trees in Malaysia were mostly under the smallholders' holdings.
Of the total CPO production, smallholders contributed the bulk at about 52% while the rest was from large plantation companies, according to the National Association of Smallholders.
Despite a RM7,000 per ha grant by the Government for smallholders to carry out replanting activities,
Boon
said: “It was difficult to persuade them especially with the CPO price
trading above RM2,000 per tonne over the past three to four years.
“What more with the CPO prices currently trading in the region of RM3,300 to RM3,370 per tonne.”
Boon, a veteran planter, said the reluctance to undertake active replanting activities could also be due to the “insufficient” grant to cover the entire replanting costs up to maturity period of about three to four years.
He pointed out that the actual replanting cost up to maturity period should be about RM12,000 per ha given the current high costs of fertiliser and pesticides.
On the country's average yields, Boon said the current national average was about 20.2 tonnes of fresh fruit bunches (FFB), 20% oil extraction rate (OER) and about four tonnes of CPO per ha.
“At the current replanting rate, it is actually difficult to comprehend how Malaysia can achieve its vision for palm oil, i.e. 35 tonnes of FFB, 25% OER and 8.75 tonnes of CPO per ha per year by 2020,” he added.
The Malaysian Palm Oil Board (MPOB) had in early January said eight entry-point projects (EPPs) under the Government's Palm Oil NKEA showed commendable achievements in meeting the targets set in 2011, the first year of its implementation.
For EPP1 in the upstream sector, the area of backlog cleared by plantations and organised smallholders, achieved 83.2% or 83,200ha last year, compared with 100,000ha in the earlier target.
Areas of new planting and replanting by smallholders reached 74.6% of the total 26,600ha. Of the total application for 37,432.64ha, about 29,995.09ha were approved and verified, said MPOB.
MPOB said oil palm felled and replanted was at 19,768.54ha last year where 8,429ha were for new planting and 11,338.92ha for replanting.
Meanwhile, United Malacca Bhd chief executive officer Dr Leong Tat Thim said replanting should be taken seriously given the high ageing profile of oil palm trees especially those over 25 years othat tended to drag the yields lower.
“In well established estates, I believe that replanting accounts for 2% to 5% of total planted area annually,” he said.
Leong estimated that the current replanting cost to maturity for most plantations could range from RM10,000 to RM13,000 per ha.
“Older palm trees are taller thus making harvesting very difficult. What more with local planters currently facing serious shortage of foreign fruit harvesters.”
He opined that the stagnating average yield performance in Malaysia among others was due to the conversion of the “hilly” rubber areas into oil palm plantations some 20 years ago.
Meanwhile, Standard Chartered Bank in its global research report “Crude palm oil - A price storm is brewing” said a severe structural slowdown in palm oil output was under way.
“The downtrend will worsen over the coming seasons with the deceleration in palm output caused largely by the ageing profile of estates in South-East Asia, which accounts for over 90% of the market, as well as sub-optimal farming practices across much of the region.
“Our conservative estimate is that more than 20% of trees in Malaysia are over 25-years-old. In reality, this could be more,” said the report.
Its long-term bullish view on CPO, relatively accommodative global interest rates and a deteriorating age profile of trees in Malaysia, should help to convince planters that replanting decision is best not to be delayed.
“We also believe there is a price storm brewing in the industry due to a deceleration in yields, the severity of which will be bullish for the market,” it added.
StanChart has forecast the annual average CPO price this year at RM3,450 per tonne. It has also revised second quarter (Q2) 2012 CPO price to RM3,500, Q3 at RM3,350 and Q4 at RM3,700 respectively.
As of 5.30pm yesterday, the benchmark third-month CPO futures contract for July was traded at RM3,373 per tonne, up RM13 from RM3,360 per tonne on Monday.
AAAAHHHAAAAA!!!!!
It is also about subsidy again??? Will cook oil price up again???
Wassalam.
-----
Wednesday May 9, 2012
Ageing oil palm plantations likely to lift CPO price
By HANIM ADNAN
nem@thestar.com.my
PETALING JAYA: Anticipation over declining crude palm oil (CPO) production due to ageing plantations in major producing countries including Malaysia, would likely bolster the commodity to hit RM4,000 per tonne by second half of this year, according to industry players.
Malaysian Estate Owners Association president Boon Weng Siew who pegged the country's total planted area with palm trees of over 20 years old to between 30% and 40%, said many of the ageing palm trees in Malaysia were mostly under the smallholders' holdings.
Of the total CPO production, smallholders contributed the bulk at about 52% while the rest was from large plantation companies, according to the National Association of Smallholders.
Despite a RM7,000 per ha grant by the Government for smallholders to carry out replanting activities,
“What more with the CPO prices currently trading in the region of RM3,300 to RM3,370 per tonne.”
Boon, a veteran planter, said the reluctance to undertake active replanting activities could also be due to the “insufficient” grant to cover the entire replanting costs up to maturity period of about three to four years.
He pointed out that the actual replanting cost up to maturity period should be about RM12,000 per ha given the current high costs of fertiliser and pesticides.
On the country's average yields, Boon said the current national average was about 20.2 tonnes of fresh fruit bunches (FFB), 20% oil extraction rate (OER) and about four tonnes of CPO per ha.
“At the current replanting rate, it is actually difficult to comprehend how Malaysia can achieve its vision for palm oil, i.e. 35 tonnes of FFB, 25% OER and 8.75 tonnes of CPO per ha per year by 2020,” he added.
The Malaysian Palm Oil Board (MPOB) had in early January said eight entry-point projects (EPPs) under the Government's Palm Oil NKEA showed commendable achievements in meeting the targets set in 2011, the first year of its implementation.
For EPP1 in the upstream sector, the area of backlog cleared by plantations and organised smallholders, achieved 83.2% or 83,200ha last year, compared with 100,000ha in the earlier target.
Areas of new planting and replanting by smallholders reached 74.6% of the total 26,600ha. Of the total application for 37,432.64ha, about 29,995.09ha were approved and verified, said MPOB.
MPOB said oil palm felled and replanted was at 19,768.54ha last year where 8,429ha were for new planting and 11,338.92ha for replanting.
Meanwhile, United Malacca Bhd chief executive officer Dr Leong Tat Thim said replanting should be taken seriously given the high ageing profile of oil palm trees especially those over 25 years othat tended to drag the yields lower.
“In well established estates, I believe that replanting accounts for 2% to 5% of total planted area annually,” he said.
Leong estimated that the current replanting cost to maturity for most plantations could range from RM10,000 to RM13,000 per ha.
“Older palm trees are taller thus making harvesting very difficult. What more with local planters currently facing serious shortage of foreign fruit harvesters.”
He opined that the stagnating average yield performance in Malaysia among others was due to the conversion of the “hilly” rubber areas into oil palm plantations some 20 years ago.
Meanwhile, Standard Chartered Bank in its global research report “Crude palm oil - A price storm is brewing” said a severe structural slowdown in palm oil output was under way.
“The downtrend will worsen over the coming seasons with the deceleration in palm output caused largely by the ageing profile of estates in South-East Asia, which accounts for over 90% of the market, as well as sub-optimal farming practices across much of the region.
“Our conservative estimate is that more than 20% of trees in Malaysia are over 25-years-old. In reality, this could be more,” said the report.
Its long-term bullish view on CPO, relatively accommodative global interest rates and a deteriorating age profile of trees in Malaysia, should help to convince planters that replanting decision is best not to be delayed.
“We also believe there is a price storm brewing in the industry due to a deceleration in yields, the severity of which will be bullish for the market,” it added.
StanChart has forecast the annual average CPO price this year at RM3,450 per tonne. It has also revised second quarter (Q2) 2012 CPO price to RM3,500, Q3 at RM3,350 and Q4 at RM3,700 respectively.
As of 5.30pm yesterday, the benchmark third-month CPO futures contract for July was traded at RM3,373 per tonne, up RM13 from RM3,360 per tonne on Monday.
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