October 30, 2008 22:01 PM
KUALA LUMPUR, Oct 30 (Bernama) -- Prime Minister Datuk Seri Abdullah Ahmad Badawi on Thursday announced an allocation of RM200 million for replanting 200,000 hectares of oil palm nationwide, saying the time when the price of palm oil was low was good to replace low-yielding, old palms.
He said the replanting would give rural smallholders the opportunity to maintain their yield and step up downstream industries.
"The rise in supply of palm oil will result in an increase in the downstream industries. This is important as the government regards the oil palm industry as strategic because the product is a national resource and the sector provides many job opportunities," he told reporters after chairing a meeting of the Cabinet committee on the Competitiveness of the Oil Palm Sector, at Parliament House here.
"Palm oil is used not only to produce foodstuff but also in making cosmetics and medical-related items and may be used as fuel to meet our needs," he said.
Abdullah said replanting could not be introduced earlier as the high price of palm oil was prohibitive for such an exercise.
Today's meeting also decided on the use of biofuel -- comprising five per cent methyl ester (palm oil) and diesel -- for government vehicles from February 2009, he said.
The implementation, in stages, would be followed by the industrial sector and the transport sector after that, he said.
Asked whether biofuel would be implemented for public vehicles, Abdullah said it could be done once the government had developed the infrastructure for the purpose nationwide.
It is estimated that the production of biofuel with five per cent palm oil would require 500,000 tonnes of palm oil annually when fully implemented in early 2010, he said.
"This does not pose a problem as we have large reserves of palm oil. We produce 17.8 million tonnes of palm oil. As such, it is not difficult to use 500,000 tonnes of palm oil annually to produce biofuel and it will not hamper other ongoing activities such as production of food, medicines, food supplements, cosmetics and other uses," he said.
Asked how the replanting exercise could boost the global price of palm oil, Abdullah said the government was trying to sustain the local production of palm oil in the future and produce high quality palm oil.
"A lot of palm oil trees must be chopped down, thus it cannot be sustainable. When the price is low, then the decision to begin replanting would be a good decision," he said.
-- BERNAMA
source: bernama.com
Showing posts with label Palm Oil. Show all posts
Showing posts with label Palm Oil. Show all posts
Thursday, October 30, 2008
Tuesday, October 28, 2008
Riau reports oil palm fruit price drop to VP
10/29/08 06:57
Pekanbaru (ANTARA News) - The Riau provincial government planned to report to Vice President Jusuf Kalla the drop in the price of the oil palm fruits of the oil palm fruit growers in Riau. "We would report the fate of the oil palm growers in the region to the vice president," Riau Governor Wan Abubakar said here Tuesday.
The Governor also said that the reporting to the vice president was his own initiative.However, he said he will pick the right time for the vice president to receive the report, not when he is still too preoccupied.
The Governor said that the Riau Government is expected the vice president to give a solution to the declining oil palm fruit prices in Riau, which may have been caused by a drop in demands from the export market due to the current financial crisis.
Besides reporting to the VP, the Riau Government set up an oil palm price supervisory team. Meanwhile based on the result of the meeting at the Riau Provincial agricultural agency in Pekanbaru, Tuesday, the price of oil palm fruits of 10-year old trees dropped to Rp766.88 per kilogram (kg) from Rp823.33. Meanwhile the price of oil palm fruits from three years trees reached Rp546.74 per kg.
COPYRIGHT © 2008
source: antara.com
Pekanbaru (ANTARA News) - The Riau provincial government planned to report to Vice President Jusuf Kalla the drop in the price of the oil palm fruits of the oil palm fruit growers in Riau. "We would report the fate of the oil palm growers in the region to the vice president," Riau Governor Wan Abubakar said here Tuesday.
The Governor also said that the reporting to the vice president was his own initiative.However, he said he will pick the right time for the vice president to receive the report, not when he is still too preoccupied.
The Governor said that the Riau Government is expected the vice president to give a solution to the declining oil palm fruit prices in Riau, which may have been caused by a drop in demands from the export market due to the current financial crisis.
Besides reporting to the VP, the Riau Government set up an oil palm price supervisory team. Meanwhile based on the result of the meeting at the Riau Provincial agricultural agency in Pekanbaru, Tuesday, the price of oil palm fruits of 10-year old trees dropped to Rp766.88 per kilogram (kg) from Rp823.33. Meanwhile the price of oil palm fruits from three years trees reached Rp546.74 per kg.
COPYRIGHT © 2008
source: antara.com
Palm oil crisis can even tie to Halloween candy
Do the pros of using palm oil outweigh the cons?
By Christina Salvo
Monday, October 27, 2008 at 7:13 p.m.
COLORADO SPRING, COLO. -- Health concerns with trans-fatty acids found in partially hydrogenated oil has led the push for palm oil as a substitute. But its increased use is causing a domino effect, creating new problems.
Trees are cleared to create oil plantations. As oil plantations expand in South America, Southeast Asia, the Pacific and Africa, environmentalists say they are transforming the ecosystems and contributing heavily to climate change.
While deforestation accounts for a quarter of global greenhouse gas emissions, it also threatens the extinction of millions of plant and animal species, including the orangutans.
"The rainforest is crucial. They need it to be able to find food and shelter," explained Dina Bredahl, Animal Care Manager at the Cheyenne Mountain Zoo.
In many areas, especially Indonesia, the rainforest is being leveled to make way for profitable palm oil plantations.
"Right now Indonesia is third highest as far as producing greenhouse gases in the world, yet they use so little as far as automobiles and other things like that. The problem is because of removing rain forests," said Bredahl.
Demand for palm oil is so high right now as people look for alternatives to trans-fat plus it can be cheaply produced, said Bredahl.
But many consumers aren't even aware any controversy exists surrounding palm oil farming.
"What you buy at the grocery store really does affect not just people in other countries, but animals as well and entire ecosystems," said Bredahl.
It's a bit of a balancing act weighing the pros against the cons of palm oil. In the meantime, Cheyenne Mountain Zoo encourages consumers to support companies that use sustainable palm oil vs. nonsustainable.
"Sustainable palm oil is produced by using already cleared land. That way you're not taking more rainforest away from orangutan and many hundreds of other species," explained Bredahl.
Click here to learn ways to help in the palm oil crisis.
source: fox21news.com
By Christina Salvo
Monday, October 27, 2008 at 7:13 p.m.
COLORADO SPRING, COLO. -- Health concerns with trans-fatty acids found in partially hydrogenated oil has led the push for palm oil as a substitute. But its increased use is causing a domino effect, creating new problems.
Trees are cleared to create oil plantations. As oil plantations expand in South America, Southeast Asia, the Pacific and Africa, environmentalists say they are transforming the ecosystems and contributing heavily to climate change.
While deforestation accounts for a quarter of global greenhouse gas emissions, it also threatens the extinction of millions of plant and animal species, including the orangutans.
"The rainforest is crucial. They need it to be able to find food and shelter," explained Dina Bredahl, Animal Care Manager at the Cheyenne Mountain Zoo.
In many areas, especially Indonesia, the rainforest is being leveled to make way for profitable palm oil plantations.
"Right now Indonesia is third highest as far as producing greenhouse gases in the world, yet they use so little as far as automobiles and other things like that. The problem is because of removing rain forests," said Bredahl.
Demand for palm oil is so high right now as people look for alternatives to trans-fat plus it can be cheaply produced, said Bredahl.
But many consumers aren't even aware any controversy exists surrounding palm oil farming.
"What you buy at the grocery store really does affect not just people in other countries, but animals as well and entire ecosystems," said Bredahl.
It's a bit of a balancing act weighing the pros against the cons of palm oil. In the meantime, Cheyenne Mountain Zoo encourages consumers to support companies that use sustainable palm oil vs. nonsustainable.
"Sustainable palm oil is produced by using already cleared land. That way you're not taking more rainforest away from orangutan and many hundreds of other species," explained Bredahl.
Click here to learn ways to help in the palm oil crisis.
source: fox21news.com
Sunday, October 19, 2008
Mahoney insulted the public
By Randy Schultz
Editor of the Editorial Page
Sunday, October 19, 2008
They never learn.
Having been exposed as a louse and a hypocrite - his campaign material stressed "faith and family" - three weeks before the election, Rep. Mahoney might have been toast no matter what he did. He's a Democrat in the eight-county, Republican-majority district who got to Washington when Mark Foley got caught in his own scandal two years ago: sending X-rated e-mails to underage congressional pages. His only chance would have been to admit his louseness and hypocrisy, then answer every reporter's question until nothing more could come out. And come alone. Don't bring your wife. Be a man.
Of course, Rep. Mahoney did none of that. He appeared Tuesday morning only long enough to read the predictable statement of regret that he got caught. He said that "no marriage is perfect," a comment as heartless as it was trite. He sounded as though he were partially blaming his wife. Whom, of course, he brought along.
I can't explain why the wives agree to come. My theory is that the husband asks because he thinks that her appearance can save him. See, even though I'm a skunk, the little lady and I are going to work it out. So, I really hope that this doesn't influence your vote. Right.
On Friday, Rep. Mahoney is supposed to debate Republican challenger Tom Rooney at the Kravis Center in West Palm Beach. Does Rep. Mahoney think that he can pull it off if he's not willing to talk about what will be on everyone's mind?
Johnson and Johnson set the gold standard for crisis response a quarter-century ago. After people died from swallowing poisoned Tylenol, the company pulled every pill. Understand, the problem wasn't even the company's fault. But Johnson and Johnson knew what was at stake. Because the company acted so swiftly and openly, the product and the company recovered quickly. The government required protective wrapping on lids of bottles containing everything from pills to juice.
Then there's Exxon, now ExxonMobil. After one of its tankers spilled 10 million gallons of oil into Alaska's Prince William Sound in 1989, the company CEO didn't arrive for three weeks. Exxon turned down the offer from a local fishing group to help contain the spill.
Most politicians read only the Exxon manual. Having insulted their family - in this case, Rep. Mahoney's wife and daughter - they insult their constituents by believing them to be stupid. Some voters may accept Rep. Mahoney's defense that his conduct was a "private matter," but most correctly will see that what these actions affected is his public role. Among other things, he put the mistress on his staff.
Monday morning, Rep. Mahoney had a strong lead and was all but reelected. By the end of the week, the polls had flopped. Rep. Mahoney didn't help himself much on Friday when he told George Bennett of The Post that it was OK to hire a mistress for his Martin County office because the affair was "intermittent." So, shouldn't she have worked part-time?
You can tell that Rep. Mahoney didn't test drive the answers he finally decided to give. At least he didn't sound quite as bad as John Edwards, who explained that his affair took place while his cancer-stricken wife was in remission. But did Rep Mahoney sound stupid? Yes. Why? They never learn.
Randy Schultz is the editor of the editorial page of The Palm Beach Post. His e-mail address is schultz@pbpost.com
source : palmbeachpost.com
Editor of the Editorial Page
Sunday, October 19, 2008
They never learn.
Despite all the history, despite all common sense, every politician caught in a sex scandal believes that he - and we're usually talking men - can tough it out. Last week, Tim Mahoney became the latest to find out that he couldn't.
You know the story. ABC News reported Monday that Rep. Mahoney, the first-term congressman from Palm Beach Gardens, had hired a mistress to work in his Washington office, fired her, and then paid her $121,000 to keep quiet about the whole thing. Later, The Post reported that Rep. Mahoney had had at least one other mistress, which apparently angered the first mistress and may have led to the breakup and payoff. The FBI is investigating whether Rep. Mahoney used campaign donations for the payoff. His attorney denies it.
Having been exposed as a louse and a hypocrite - his campaign material stressed "faith and family" - three weeks before the election, Rep. Mahoney might have been toast no matter what he did. He's a Democrat in the eight-county, Republican-majority district who got to Washington when Mark Foley got caught in his own scandal two years ago: sending X-rated e-mails to underage congressional pages. His only chance would have been to admit his louseness and hypocrisy, then answer every reporter's question until nothing more could come out. And come alone. Don't bring your wife. Be a man.
Of course, Rep. Mahoney did none of that. He appeared Tuesday morning only long enough to read the predictable statement of regret that he got caught. He said that "no marriage is perfect," a comment as heartless as it was trite. He sounded as though he were partially blaming his wife. Whom, of course, he brought along.
I can't explain why the wives agree to come. My theory is that the husband asks because he thinks that her appearance can save him. See, even though I'm a skunk, the little lady and I are going to work it out. So, I really hope that this doesn't influence your vote. Right.
On Friday, Rep. Mahoney is supposed to debate Republican challenger Tom Rooney at the Kravis Center in West Palm Beach. Does Rep. Mahoney think that he can pull it off if he's not willing to talk about what will be on everyone's mind?
Johnson and Johnson set the gold standard for crisis response a quarter-century ago. After people died from swallowing poisoned Tylenol, the company pulled every pill. Understand, the problem wasn't even the company's fault. But Johnson and Johnson knew what was at stake. Because the company acted so swiftly and openly, the product and the company recovered quickly. The government required protective wrapping on lids of bottles containing everything from pills to juice.
Then there's Exxon, now ExxonMobil. After one of its tankers spilled 10 million gallons of oil into Alaska's Prince William Sound in 1989, the company CEO didn't arrive for three weeks. Exxon turned down the offer from a local fishing group to help contain the spill.
Most politicians read only the Exxon manual. Having insulted their family - in this case, Rep. Mahoney's wife and daughter - they insult their constituents by believing them to be stupid. Some voters may accept Rep. Mahoney's defense that his conduct was a "private matter," but most correctly will see that what these actions affected is his public role. Among other things, he put the mistress on his staff.
Monday morning, Rep. Mahoney had a strong lead and was all but reelected. By the end of the week, the polls had flopped. Rep. Mahoney didn't help himself much on Friday when he told George Bennett of The Post that it was OK to hire a mistress for his Martin County office because the affair was "intermittent." So, shouldn't she have worked part-time?
You can tell that Rep. Mahoney didn't test drive the answers he finally decided to give. At least he didn't sound quite as bad as John Edwards, who explained that his affair took place while his cancer-stricken wife was in remission. But did Rep Mahoney sound stupid? Yes. Why? They never learn.
Randy Schultz is the editor of the editorial page of The Palm Beach Post. His e-mail address is schultz@pbpost.com
source : palmbeachpost.com
Nigeria needs to depend less on oil
By Our Reader
Published: Sunday, 19 Oct 2008
In the world of Information Technology, there is what is called disaster recovery strategy. Corporations spend millions of dollars to build backup sites just in case their production site is consumed by any natural or man-made disaster. It is not that these corporations have money to waste by replicating their infrastructure but it is a very critical business need. Liking Nigeria to a Corporation, what is our own disaster recovery strategy in case our oil wells dry up or some disasters make it impossible for production to go on for a whole year? I do believe that we have technocrats in the cabinet of Umaru Yar’Adua and it is high time they began to put this into perspective.
Nigeria is abundantly blessed with natural endownments – the Olumo rock, the water falls, Yankari games reserve and others. How far have we gone to develop tourism? Maybe we should just shut down all oil wells and see if there is any backup. Of course I know this position might sound sarcastic and bizarre but it will open our eyes to the truth.
Barth Okonkwo,
Adeola Hopewell, Victoria Island,
barthlini@yahoo.com.
source: punchng.com
Published: Sunday, 19 Oct 2008
Has anyone ever imagined Nigeria without oil? Perhaps, it has not crossed our minds that one day, we might sell our last drop.
In the world of Information Technology, there is what is called disaster recovery strategy. Corporations spend millions of dollars to build backup sites just in case their production site is consumed by any natural or man-made disaster. It is not that these corporations have money to waste by replicating their infrastructure but it is a very critical business need. Liking Nigeria to a Corporation, what is our own disaster recovery strategy in case our oil wells dry up or some disasters make it impossible for production to go on for a whole year? I do believe that we have technocrats in the cabinet of Umaru Yar’Adua and it is high time they began to put this into perspective.
A particular Asian country, Malaysia I guess, took oil fruit from Nigeria to cultivate in their country. Today, they are playing big in palm oil and other associated by-products of palm fruit. United Arab Emirate was a desert before. I even learnt they had come to Nigeria to borrow before. Presently, a lot of us fight for Emirate‘s ticket to fly to Dubai for vacation and shopping. How did they make it happen? Some smart and serious minded guys in that country came together and strategised on how to move their country forward.
What has happened to agriculture in Nigeria? What have become of our groundnut pyramids in the North and the cocoa in the West? We have all abandoned these to local farmers with occasional distribution of fertilizers to them. We are all in the mad chase for oil.
Nigeria is abundantly blessed with natural endownments – the Olumo rock, the water falls, Yankari games reserve and others. How far have we gone to develop tourism? Maybe we should just shut down all oil wells and see if there is any backup. Of course I know this position might sound sarcastic and bizarre but it will open our eyes to the truth.
Adeola Hopewell, Victoria Island,
barthlini@yahoo.com.
source: punchng.com
Colombia to have six palm biodiesel plants by 2009
October 18, 2008
On the sidelines of a meeting on sustainable palm oil that ended Friday in the Colombian coastal city of Cartagena, Nu?ez said that this year just a small percentage of palm oil output was destined for biofuels production "because the plants have not begun to function fully."She also said that the export markets for palm oil will continue to be affected by the current financial crisis and noted that the price of the vegetable oil has plunged from $1,400 per ton a few months ago to some $525 per ton at present.Nu?ez said that lower price was due to several reasons: "high inventories in Malaysia and Indonesia, market expectations related to the financial crisis and the reduction in oil prices.
source: tmcnet.com
(EFE Ingles Via Acquire Media NewsEdge) Cartagena, Colombia, Oct 18 (EFE).- Colombia, the leading producer of palm oil in the Americas, will have six palm biodiesel plants by next year and plans to increase its share of the biofuels market, sources from the sector said.
In an interview Friday with Efe, the president of Colombian palm oil producer Comercializadora Internacional Acepalma, Maria Emma Nu?ez, said that four of these six plants have already begun operating, but that production will be stepped up next year and the other two plants will also come on stream."At this time, (palm oil production) is destined for processing plants to make cooking oil, margarine and soaps, and there has been a little this year for the biodiesel plants, but by next year a significant percentage of production will be destined for the biodiesel plants," she said.
On the sidelines of a meeting on sustainable palm oil that ended Friday in the Colombian coastal city of Cartagena, Nu?ez said that this year just a small percentage of palm oil output was destined for biofuels production "because the plants have not begun to function fully."She also said that the export markets for palm oil will continue to be affected by the current financial crisis and noted that the price of the vegetable oil has plunged from $1,400 per ton a few months ago to some $525 per ton at present.Nu?ez said that lower price was due to several reasons: "high inventories in Malaysia and Indonesia, market expectations related to the financial crisis and the reduction in oil prices.
"She added that Colombian production of palm oil is expected to rise from 806,000 tons in 2008 to some 872,000 tons next year.Of the current production, some 46 percent is destined for export, primarily to the Netherlands, Germany and England in Europe, as well as to Mexico, the Caribbean, Brazil, Peru, Argentina and the United States in the Americas.The goal of the Cartagena meeting on palm oil was to internationally certify the region's biodiesel producers.Business leaders from Brazil, Colombia, Costa Rica, Ecuador, Guatemala, Honduras, Peru and Venezuela took part in the two-day gathering, where they learned about the successful experience with palm oil production in Indonesia, Malaysia and Thailand, which combine for 88 percent of total world output.
Separately, an sugarcane ethanol plant capable of producing 1.8 million liters (475,000 gallons) annually was inaugurated Friday in the central Colombian town of Barbosa, some 300 kilometers (186 miles) from Bogota.President Alvaro Uribe and Agriculture Minister Andres Arias inaugurated the plant, which, according to officials, will create a total of 429 jobs.
EFEfer/mcCopyright ? 2008 EFE News Services (U.S.) Inc.
source: tmcnet.com
Friday, October 17, 2008
Palm oil prices poised to plunge
PHUSADEE ARUNMAS
Prices of cooking palm oil will fall by as much as 20% from Nov 1, reflecting the decline in world prices resulting from an increase in palm nut supplies. The Commerce Ministry confirmed the reduction yesterday of its retail reference price for the oil to 38 baht a litre from 47.50 baht.
The sharp decline in palm prices has also been affected by the fall in world crude oil prices, which have shed 45% since July on concerns about a slowing global economy.
As a result, the drive to produce alternative fuels, including biofuels derived from palm oil, has lost some of its urgency, and more palm raw materials have become available for food processing again.
However, palm growers will not suffer unduly from the drop in retail prices, according to Vatchari Vimooktayon, the deputy director-general of the ministry's Internal Trade Department.
She said that the ministry's subcommittee on vegetable oil agreed yesterday to raise the reference price of palm nuts sold to refiners to 3.50 baht a kilogramme, above current market rates of 3.20 baht, to help farmers affected by price declines.
Prices of palm nuts rose to as much as 4.50 to five baht per kilogramme early this year because of high demand for biodiesel.
However, prices started falling gradually on increased production and the easing oil prices.
Production of palm nuts is estimated at 8.45 million tonnes this year versus 6.08 million tonnes last year.
Mrs Vatchari said the government also urged refineries to price crude palm oil in parallel with the prices they paid farmers for palm nuts, meaning crude palm oil should be around 22-23 baht per kilogramme.
source: bangkokpost.com
Prices of cooking palm oil will fall by as much as 20% from Nov 1, reflecting the decline in world prices resulting from an increase in palm nut supplies. The Commerce Ministry confirmed the reduction yesterday of its retail reference price for the oil to 38 baht a litre from 47.50 baht.
The sharp decline in palm prices has also been affected by the fall in world crude oil prices, which have shed 45% since July on concerns about a slowing global economy.
As a result, the drive to produce alternative fuels, including biofuels derived from palm oil, has lost some of its urgency, and more palm raw materials have become available for food processing again.
However, palm growers will not suffer unduly from the drop in retail prices, according to Vatchari Vimooktayon, the deputy director-general of the ministry's Internal Trade Department.
She said that the ministry's subcommittee on vegetable oil agreed yesterday to raise the reference price of palm nuts sold to refiners to 3.50 baht a kilogramme, above current market rates of 3.20 baht, to help farmers affected by price declines.
Prices of palm nuts rose to as much as 4.50 to five baht per kilogramme early this year because of high demand for biodiesel.
However, prices started falling gradually on increased production and the easing oil prices.
Production of palm nuts is estimated at 8.45 million tonnes this year versus 6.08 million tonnes last year.
Mrs Vatchari said the government also urged refineries to price crude palm oil in parallel with the prices they paid farmers for palm nuts, meaning crude palm oil should be around 22-23 baht per kilogramme.
source: bangkokpost.com
Financial Crisis Woes Add To Gloom At Malaysia-China Palm Oil Seminar
October 16, 2008 19:39 PM
By Tham Choy Lin
NANJING, Oct 16 (Bernama) -- Sentiment was bearish at the Malaysia-China Palm Oil Seminar 2008 which opened here Thursday as Asian stock markets and crude oil price took another dive in heightened fears of a global recession following poor retail sales numbers from the United States.
Traders attending the two-day seminar came largely to get a better grip of fluctuating prices and the direction of China, the world's largest oils and fats consumer and a key importer of Malaysian palm oil.
Malaysia Palm Oil Council (MPOC) chief executive officer Tan Sri Dr Yusof Basiron, an industry veteran, was sanguine of the outlook for palm oil which had dipped below RM1,800 per tonne.
"The price outlook is very much linked to petroluem prices, that's out of our control but what we can do is to manage the price volatility and supply equation. Once the supply expansion gets back to normal rate, it is a factor of time before the market corrects itself," he told Bernama on the sidelines of the seminar.
The Malaysian government will consider on Oct 21 a proposal to blend up to five percent of palm oil with diesel for use by public transport to shore up the price which has nosedived from a record of over RM4000 per tonne in March to less than half.
Yusof said if approved, the move would trim the country's current palm oil stock of 1.92 million tonnes by between 200,000 tonnes to 5000,000 tonnes.
"This will create a new demand for palm oil and it will offset any big shocks developing and stabilise prices. Before this, our palm oil was not used much for biodiesel and it tends to be traded at a discount even to petroluem," he said.
A commodity broker, who declined to be named, said that the market was leaning towards more downside.
"Consumers are standing on the sidelines and over the past few months, I have not sealed any significant contracts," he said.
Tracing the downward spiral, Martin Bek-Nielsen, executive director of United Plantations Bhd, among Malaysia's industry giants, said the build-up of palm oil stocks, to reach 2.2 million tonnes, from high production this year, had led to concerns that the high prices could not be sustained.
Adding to the pressure was the appreciation of the US dollar, falling price of crude oil and now, the international financial crisis which clipped the possibility of a sustaining level or a rebound after falling through the RM2,000 mark.
"The financial crisis and meltdown of the stock markets has instill such a fear in the minds of people, hedge funds were slaughtered and the general market sentiment is so bearish," Bek-Nielsen said.
He said the crisis had dashed the possibility of the price returning to a sustainable level or by now, a rebound after falling through the RM2,000 mark.
With Wednesday's closing price of RM1,749 and the limit down on soy oil trading, Bek-Nielsen said the price may shed further to the RM1,600 region and he expects it would eventually improved in light of a downturn in supply following the high production this year.
But it would take it another half or one year to see another big appreciation, he said.
"At the end of the day if the financial crisis is as bad as people anticipate, we should be in a period of low price levels until the world economy show signs of improvement," he added.
The seminar, held for the second time since 2006, is organised in tandem with the China International Conference of Seed Crushers.
Nineteen Malaysian companies, including industry players like Sime Darby and Felda, as well as Bursa Malaysia, which is the benchmark in palm oil futures, are taking part.
-- BERNAMA
source: bernama.com.my
By Tham Choy Lin
NANJING, Oct 16 (Bernama) -- Sentiment was bearish at the Malaysia-China Palm Oil Seminar 2008 which opened here Thursday as Asian stock markets and crude oil price took another dive in heightened fears of a global recession following poor retail sales numbers from the United States.
Traders attending the two-day seminar came largely to get a better grip of fluctuating prices and the direction of China, the world's largest oils and fats consumer and a key importer of Malaysian palm oil.
Malaysia Palm Oil Council (MPOC) chief executive officer Tan Sri Dr Yusof Basiron, an industry veteran, was sanguine of the outlook for palm oil which had dipped below RM1,800 per tonne.
"The price outlook is very much linked to petroluem prices, that's out of our control but what we can do is to manage the price volatility and supply equation. Once the supply expansion gets back to normal rate, it is a factor of time before the market corrects itself," he told Bernama on the sidelines of the seminar.
The Malaysian government will consider on Oct 21 a proposal to blend up to five percent of palm oil with diesel for use by public transport to shore up the price which has nosedived from a record of over RM4000 per tonne in March to less than half.
Yusof said if approved, the move would trim the country's current palm oil stock of 1.92 million tonnes by between 200,000 tonnes to 5000,000 tonnes.
"This will create a new demand for palm oil and it will offset any big shocks developing and stabilise prices. Before this, our palm oil was not used much for biodiesel and it tends to be traded at a discount even to petroluem," he said.
A commodity broker, who declined to be named, said that the market was leaning towards more downside.
"Consumers are standing on the sidelines and over the past few months, I have not sealed any significant contracts," he said.
Tracing the downward spiral, Martin Bek-Nielsen, executive director of United Plantations Bhd, among Malaysia's industry giants, said the build-up of palm oil stocks, to reach 2.2 million tonnes, from high production this year, had led to concerns that the high prices could not be sustained.
Adding to the pressure was the appreciation of the US dollar, falling price of crude oil and now, the international financial crisis which clipped the possibility of a sustaining level or a rebound after falling through the RM2,000 mark.
"The financial crisis and meltdown of the stock markets has instill such a fear in the minds of people, hedge funds were slaughtered and the general market sentiment is so bearish," Bek-Nielsen said.
He said the crisis had dashed the possibility of the price returning to a sustainable level or by now, a rebound after falling through the RM2,000 mark.
With Wednesday's closing price of RM1,749 and the limit down on soy oil trading, Bek-Nielsen said the price may shed further to the RM1,600 region and he expects it would eventually improved in light of a downturn in supply following the high production this year.
But it would take it another half or one year to see another big appreciation, he said.
"At the end of the day if the financial crisis is as bad as people anticipate, we should be in a period of low price levels until the world economy show signs of improvement," he added.
The seminar, held for the second time since 2006, is organised in tandem with the China International Conference of Seed Crushers.
Nineteen Malaysian companies, including industry players like Sime Darby and Felda, as well as Bursa Malaysia, which is the benchmark in palm oil futures, are taking part.
-- BERNAMA
source: bernama.com.my
Thursday, October 16, 2008
S'wak oil palm plantation firms appeal for help
Sibu: Seven major oil palm plantation companies in the state say they are burdened by taxes as high as up to 55 percent.
The companies-Ta Ann Holdings Bhd, Sarawak Oil Palm Bhd, Solid Timber, WTK Holdings Bhd, Woodman Kuala Baram Estate Sdn Bhd, Sarawak Plantation Bhd and the Rimbunan Hijau Group-are appealing to both the federal and state governments, asking for a reduction of taxes and cess contributions.
The seven accounted for more than 50 percent of the state palm oil annual production.
The palm oil cess imposed by the federal government on palm oil plantations is to subsidise the price of cooking oil.
At a press conference here Monday night, a spokesman for the group, Bolhair Redzuan, a senior executive of Sarawak Plantation, said they had six proposals for the federal government and three for the state governments.
The proposals were aimed at strengthening the position of the industry, he said.
"We want the federal government to consider waiving the windfall profit levy, the outstanding amount on Malaysian Palm Oil Board (MPOB) cess and the workers' levy," Bolhair said.
"At the same time we want it to review the discount on CPO (crude palm oil) price for Sabah and Sarawak, the MPOB oil cess and fertiliser subsidy," he said.
Bolhair said the group was asking the state government to legalise the illegal foreign workers now employed in its oil palm plantations, saying the state was suffering from a shoratge of workers.
He said other proposals were for the government to consider reducing the special sales tax on CPO and palm kernel and deferring the local council assessment rates on the plantations for the first 10 years.
"Besides the hefty taxes, the industry faces challenges such as low CPO prices, escalating costs of fertilisers, chemicals and fuel as well as labour shortage where the reliance is 95 percent on foreign workers," he said.
According to him, the group felt it was unfair for them to pay the windfall profit levy as Sarawak "is a late entrant in the industry and has the lowest area (at 20 percent) that can contribute to profit".
Although Sarawak has, to date, developed 664,612 hectares, only 103,678 hecatres or 20 percent are income-generating or matured areas.
"Thus, we are still not yet financially self-sufficient in our operations. We still require huge cashflow or injection of funds," he added.
Bolhair said the windfall profit tax affected not only the big players but small companies and smallholders who were still struggling to make ends meet.
"This is putting a lot of pressure on them. We are not questioning this policy of the government but wondering why the oil palm business is selected for this tax," he said.
On the cess fee paid to MPOB to allow it to carry more research, Bolhair said the group hoped for a generous discount for the state in view of the age of the industry, the long gestation and investment recouping periods as well as the difficult soil and terrain conditions.
"We rather the fee be considered based on case-by-case basis. Perhaps the government can consider implementing differentials in terms of cess contribution where the bigger companies will have to pay more," he said.
On fertiliser, Bolhair said it had drastically increased in prices by 150 to 370 percent and was still rising.
The capital investment in the form of plantation development expenditure in the industry has reached an estimated RM11.36 billion in the last six years of oil palm plantation growth in the state, he said.
The plantation sector has generated 14,000 direct job opportunities for Sarawakians, including management and operation staff. - Bernama
source: dailyexpress.com.my
The companies-Ta Ann Holdings Bhd, Sarawak Oil Palm Bhd, Solid Timber, WTK Holdings Bhd, Woodman Kuala Baram Estate Sdn Bhd, Sarawak Plantation Bhd and the Rimbunan Hijau Group-are appealing to both the federal and state governments, asking for a reduction of taxes and cess contributions.
The seven accounted for more than 50 percent of the state palm oil annual production.
The palm oil cess imposed by the federal government on palm oil plantations is to subsidise the price of cooking oil.
At a press conference here Monday night, a spokesman for the group, Bolhair Redzuan, a senior executive of Sarawak Plantation, said they had six proposals for the federal government and three for the state governments.
The proposals were aimed at strengthening the position of the industry, he said.
"We want the federal government to consider waiving the windfall profit levy, the outstanding amount on Malaysian Palm Oil Board (MPOB) cess and the workers' levy," Bolhair said.
"At the same time we want it to review the discount on CPO (crude palm oil) price for Sabah and Sarawak, the MPOB oil cess and fertiliser subsidy," he said.
Bolhair said the group was asking the state government to legalise the illegal foreign workers now employed in its oil palm plantations, saying the state was suffering from a shoratge of workers.
He said other proposals were for the government to consider reducing the special sales tax on CPO and palm kernel and deferring the local council assessment rates on the plantations for the first 10 years.
"Besides the hefty taxes, the industry faces challenges such as low CPO prices, escalating costs of fertilisers, chemicals and fuel as well as labour shortage where the reliance is 95 percent on foreign workers," he said.
According to him, the group felt it was unfair for them to pay the windfall profit levy as Sarawak "is a late entrant in the industry and has the lowest area (at 20 percent) that can contribute to profit".
Although Sarawak has, to date, developed 664,612 hectares, only 103,678 hecatres or 20 percent are income-generating or matured areas.
"Thus, we are still not yet financially self-sufficient in our operations. We still require huge cashflow or injection of funds," he added.
Bolhair said the windfall profit tax affected not only the big players but small companies and smallholders who were still struggling to make ends meet.
"This is putting a lot of pressure on them. We are not questioning this policy of the government but wondering why the oil palm business is selected for this tax," he said.
On the cess fee paid to MPOB to allow it to carry more research, Bolhair said the group hoped for a generous discount for the state in view of the age of the industry, the long gestation and investment recouping periods as well as the difficult soil and terrain conditions.
"We rather the fee be considered based on case-by-case basis. Perhaps the government can consider implementing differentials in terms of cess contribution where the bigger companies will have to pay more," he said.
On fertiliser, Bolhair said it had drastically increased in prices by 150 to 370 percent and was still rising.
The capital investment in the form of plantation development expenditure in the industry has reached an estimated RM11.36 billion in the last six years of oil palm plantation growth in the state, he said.
The plantation sector has generated 14,000 direct job opportunities for Sarawakians, including management and operation staff. - Bernama
source: dailyexpress.com.my
Palm oil mill fined RM10,000 for discharging toxic effluents into river
Bernama
The Sessions Court here yesterday imposed a fine of RM10,000 on a palm oil mill located in Jalan Ayer Tawar, Manjung, about 70km from here, for discharging toxic effluents into a river nearby the mill on Sept 19, 2007.
Judge Tan Hooi Leng castigated Pantai Remis Palm Oil Mill Sdn Bhd for not adhering to Department of Environment (DOE) regulations in causing pollution in the river.
The mill’s owners were charged under Section 16(1) of Environmental Quality Act 1974 for the offence and could have been fined a maximum of RM25,000 or jailed not more than two years of both.
The prosecution was conducted by Perak DOE prosecuting officer Thamara Selvam a/l Vyapuri.
source: nst.com.my
The Sessions Court here yesterday imposed a fine of RM10,000 on a palm oil mill located in Jalan Ayer Tawar, Manjung, about 70km from here, for discharging toxic effluents into a river nearby the mill on Sept 19, 2007.
Judge Tan Hooi Leng castigated Pantai Remis Palm Oil Mill Sdn Bhd for not adhering to Department of Environment (DOE) regulations in causing pollution in the river.
The mill’s owners were charged under Section 16(1) of Environmental Quality Act 1974 for the offence and could have been fined a maximum of RM25,000 or jailed not more than two years of both.
The prosecution was conducted by Perak DOE prosecuting officer Thamara Selvam a/l Vyapuri.
source: nst.com.my
Adonis hints UK is wavering on biofuel targets
DUBLIN, Ireland, Oct 15, 2008 (BUSINESS WIRE) -- Research and Markets ( http://www.researchandmarkets.com/research/d19600/canada_biofuels_ma) has announced the addition of the "Canada Biofuels Market Potential" report to their offering.
Biofuel is any fuel that is derived from biomass -- recently living organisms or their metabolic byproducts, such as manure from cows. It is a renewable energy source, unlike other natural resources such as petroleum, coal, and nuclear fuels.
Ethanol is manufactured from microbial conversion of biomass materials through fermentation. Ethanol contains 35% oxygen. The production process consists of conversion of biomass to fermentable sugars, fermentation of sugars to ethanol, and the separation and purification of the ethanol. Fermentation initially produces ethanol containing a substantial amount of water. Distillation removes the majority of water to yield about 95% purity ethanol, the balance being water. This mixture is called hydrous ethanol. If the remaining water is removed in a further process, the ethanol is called anhydrous ethanol and is suitable for blending into gasoline. Ethanol is "denatured" prior to leaving the plant to make it unfit for human consumption by addition of a small amount of products such as gasoline.
Biodiesel fuels are oxygenated organic compounds -- methyl or ethyl esters -- derived from a variety of renewable sources such as vegetable oil, animal fat, and cooking oil. The oxygen contained in biodiesel makes it unstable and requires stabilization to avoid storage problems. Rapeseed methyl ester (RME) diesel, derived from rapeseed oil, is the most common biodiesel fuel available in Europe. In the United States, biodiesel from soybean oil, called soy methyl ester diesel, is the most common biodiesel. Collectively, these fuels are referred to as fatty acid methyl esters (FAME).
Biofuels have become a growth industry with worldwide production more than doubling in the last five years. The rapid expansion of ethanol production in the United States and biodiesel production (and to a lesser extent, biogas) in Germany and other countries in Western Europe has created a biofuels frenzy that has affected many countries, including Canada. Many measures have been used to stimulate production and consumption of biofuels, including preferential taxation, subsidies, import tariffs and consumption mandates. Recently, Canadian federal and provincial governments have announced consumption mandates and subsidies to assist rapid expansion of biofuel production in Canada.
Canada has considerable natural resources and is one of the world's largest producers and exporters of energy. In 2006, Canada produced 21.1 quadrillion British Thermal Units (Btu) of total energy, the fifth largest amount in the world. Since 1980, Canada's total energy production has increased by 86%, while its total energy consumption has increased by only 48% during that period. Almost all of Canada's energy exports go to the United States, making it the largest foreign source of U.S. energy imports: Canada is consistently among the top sources for U.S. oil imports, and it is the largest source of U.S. natural gas and electricity imports. Recognizing the importance of the energy trade between the two countries, both participate in the North American Energy Working Group, which seeks to improve energy integration and cooperation between Canada, the U.S., and Mexico.
The report Biofuel Industry in Canada is a complete coverage of the ethanol and biodiesel market in the country.
source: businessgreen.com
Biofuel is any fuel that is derived from biomass -- recently living organisms or their metabolic byproducts, such as manure from cows. It is a renewable energy source, unlike other natural resources such as petroleum, coal, and nuclear fuels.
Ethanol is manufactured from microbial conversion of biomass materials through fermentation. Ethanol contains 35% oxygen. The production process consists of conversion of biomass to fermentable sugars, fermentation of sugars to ethanol, and the separation and purification of the ethanol. Fermentation initially produces ethanol containing a substantial amount of water. Distillation removes the majority of water to yield about 95% purity ethanol, the balance being water. This mixture is called hydrous ethanol. If the remaining water is removed in a further process, the ethanol is called anhydrous ethanol and is suitable for blending into gasoline. Ethanol is "denatured" prior to leaving the plant to make it unfit for human consumption by addition of a small amount of products such as gasoline.
Biodiesel fuels are oxygenated organic compounds -- methyl or ethyl esters -- derived from a variety of renewable sources such as vegetable oil, animal fat, and cooking oil. The oxygen contained in biodiesel makes it unstable and requires stabilization to avoid storage problems. Rapeseed methyl ester (RME) diesel, derived from rapeseed oil, is the most common biodiesel fuel available in Europe. In the United States, biodiesel from soybean oil, called soy methyl ester diesel, is the most common biodiesel. Collectively, these fuels are referred to as fatty acid methyl esters (FAME).
Biofuels have become a growth industry with worldwide production more than doubling in the last five years. The rapid expansion of ethanol production in the United States and biodiesel production (and to a lesser extent, biogas) in Germany and other countries in Western Europe has created a biofuels frenzy that has affected many countries, including Canada. Many measures have been used to stimulate production and consumption of biofuels, including preferential taxation, subsidies, import tariffs and consumption mandates. Recently, Canadian federal and provincial governments have announced consumption mandates and subsidies to assist rapid expansion of biofuel production in Canada.
Canada has considerable natural resources and is one of the world's largest producers and exporters of energy. In 2006, Canada produced 21.1 quadrillion British Thermal Units (Btu) of total energy, the fifth largest amount in the world. Since 1980, Canada's total energy production has increased by 86%, while its total energy consumption has increased by only 48% during that period. Almost all of Canada's energy exports go to the United States, making it the largest foreign source of U.S. energy imports: Canada is consistently among the top sources for U.S. oil imports, and it is the largest source of U.S. natural gas and electricity imports. Recognizing the importance of the energy trade between the two countries, both participate in the North American Energy Working Group, which seeks to improve energy integration and cooperation between Canada, the U.S., and Mexico.
The report Biofuel Industry in Canada is a complete coverage of the ethanol and biodiesel market in the country.
source: businessgreen.com
FDA recalls skimmed milk with palm oil
Thu, Oct 16, 2008The Nation,ANN
THAILAND - The Food and Drug Administration yesterday ordered a nationwide recall of unsweetened condensed skimmed milk with a palmoil formula and products using the same ingredients after finding high melamine contamination at the Thai Dairy Industry's factory.
As an immediate measure, the FDA confiscated 150,000 cans of the product to study the melamine content and instructed all provincial public health units to pull all similar products off the shelves.
Dr Pipat Yingseri, secretarygeneral of the FDA, said inspectors had randomly collected 10 samples of milk products from Thai Dairy Industry's plant for examination.
The laboratory tests run by the Medical Science Department detected 92.82 milligrams of melamine compound per kilogram of unsweetened condensed skimmed milk with palm oil formula.
This transgresses the FDA standard of not more than 1 milligram per kilogram or 2.5 milligrams per kilogram of milkbased food and beverages. The company will face a fine of Bt5,000 to Bt20,000 and its executives imprisonment for six months to two years, he said.
The FDA is now investigating all raw materials that the company imported from Belgium, Switzerland, Australia, Germany, India and Burma.
Six dairy products were considered safe for human consumption, he said.
The three products from Snow Brand are modified milk readytomelt formula 2 Nuo Plus for infants and children aged six months to three years, modified milk readytomelt formula 1 Duo for newborns to infants aged one year, and readytomelt milk formula 3 Nuo Kids for infants aged one year and family members.
The three other products are Mali's sweetened condensed skimmed milk with palm oil and butter oil formula (skimmed powdered milk 20 per cent), Foster Farms Dairy's nonfat dry milk made from pasteurised milk, and skimmed powdered milk.
Three more products are now being checked for traces of melamine - Orchid salted butter, Birdwings sweetened condensed nondairy creamer, and sweetened condensed milk. The lab results will be released soon.
Suwit Polviwat, assistant managing director of Thai Dairy Industry, said he had not received any reports yet and could not give any details about the melamine contamination in the company's product because he was not working at the office at that time.
"We are now checking which product lots were tainted with melamine and will officially disclose the details to the media later," he said.
Pipat said the FDA had tested 519 milkbased products for contamination. The lab results of 200 products were positive and the products found safe for consumption. The rest of products are being investigated.
Some manufacturers have not reported the source of their raw materials use to make milk products to the FDA, he said.
The lab test results on S&P Syndicate's cookies and ingredients are expected to be available today.
People should drink lots of water to drain the melamine toxin from their kidneys in order to avoid the severe symptoms from drinking melaminetainted milk products, he said.
The World Health Organisation has recommended the intake amount of melamine compound at not more than 0.5 milligram per kilogram per day.
Pipat said people could receive a maximum of over 25 milligrams per day of melamine compound.
source: news.asiaone.com
THAILAND - The Food and Drug Administration yesterday ordered a nationwide recall of unsweetened condensed skimmed milk with a palmoil formula and products using the same ingredients after finding high melamine contamination at the Thai Dairy Industry's factory.
As an immediate measure, the FDA confiscated 150,000 cans of the product to study the melamine content and instructed all provincial public health units to pull all similar products off the shelves.
Dr Pipat Yingseri, secretarygeneral of the FDA, said inspectors had randomly collected 10 samples of milk products from Thai Dairy Industry's plant for examination.
The laboratory tests run by the Medical Science Department detected 92.82 milligrams of melamine compound per kilogram of unsweetened condensed skimmed milk with palm oil formula.
This transgresses the FDA standard of not more than 1 milligram per kilogram or 2.5 milligrams per kilogram of milkbased food and beverages. The company will face a fine of Bt5,000 to Bt20,000 and its executives imprisonment for six months to two years, he said.
The FDA is now investigating all raw materials that the company imported from Belgium, Switzerland, Australia, Germany, India and Burma.
Six dairy products were considered safe for human consumption, he said.
The three products from Snow Brand are modified milk readytomelt formula 2 Nuo Plus for infants and children aged six months to three years, modified milk readytomelt formula 1 Duo for newborns to infants aged one year, and readytomelt milk formula 3 Nuo Kids for infants aged one year and family members.
The three other products are Mali's sweetened condensed skimmed milk with palm oil and butter oil formula (skimmed powdered milk 20 per cent), Foster Farms Dairy's nonfat dry milk made from pasteurised milk, and skimmed powdered milk.
Three more products are now being checked for traces of melamine - Orchid salted butter, Birdwings sweetened condensed nondairy creamer, and sweetened condensed milk. The lab results will be released soon.
Suwit Polviwat, assistant managing director of Thai Dairy Industry, said he had not received any reports yet and could not give any details about the melamine contamination in the company's product because he was not working at the office at that time.
"We are now checking which product lots were tainted with melamine and will officially disclose the details to the media later," he said.
Pipat said the FDA had tested 519 milkbased products for contamination. The lab results of 200 products were positive and the products found safe for consumption. The rest of products are being investigated.
Some manufacturers have not reported the source of their raw materials use to make milk products to the FDA, he said.
The lab test results on S&P Syndicate's cookies and ingredients are expected to be available today.
People should drink lots of water to drain the melamine toxin from their kidneys in order to avoid the severe symptoms from drinking melaminetainted milk products, he said.
The World Health Organisation has recommended the intake amount of melamine compound at not more than 0.5 milligram per kilogram per day.
Pipat said people could receive a maximum of over 25 milligrams per day of melamine compound.
source: news.asiaone.com
Renewed selling of blue chips drags down KLCI
Thursday October 16, 2008
By IZWAN IDRIS and YVONNE TAN
PETALING JAYA: Stocks on Bursa Malaysia tumbled yesterday, dragged down by renewed sell-off on blue-chip firms like KNM Group Bhd and IOI Corp Bhd amid worries that falling commodity prices and weaker global growth outlook will hurt earnings.
The KL Composite Index dropped 16.18 points, or 1.7%, to 949.88 points yesterday, which also reflected declines in other regional markets. In Hong Kong, the benchmark Hang Seng index was down 5% and stocks in Singapore fell 3.2%.
Almost all major markets in Asia were lower with shares in South Korea down 2%, while Australian stocks lost 0.8%. In Indonesia, the Jakarta Composite Index retreated 2.2%.
Shares in Japan reversed early losses to end up 1%, rising on the back of a massive 14% jump on Tuesday.
“Investors are pricing in a much slower earnings growth next year,’’ said a fund manager at a local asset management firm.
“Concerns over global recession weigh heavily on the market and this will limit stocks’ upside potential in the near term,” he added.
Shares in KNM, one of the country’s biggest oil and gas fabricators, plunged 21.5 sen, or 24%, yesterday to 69 sen with 154 million shares transacted.
Yesterday’s market volume was 572 million shares.
Analysts said the huge sell-down on KNM was partly due to worries the company was facing a tougher operating environment owing to falling crude oil prices.
Filings with Bursa Malaysia showed the group’s major shareholders, including foreign funds, had aggressively trimmed down their holdings in KNM in recent weeks.
Crude oil in New York yesterday fell to below US$77 per barrel on concerns demand would falter as the financial crisis crippled global economic growth. The crude oil price had plummeted 47% from its peak of US$147 per barrel three months ago.
KNM told Bursa Malaysia yesterday it had accepted Malayan Banking Bhd’s (Maybank) offer of a three-year term loan worth 150 million euros to settle the bridging loan granted by Maybank for the acquisition of German-based Borsig GmbH.
The takeover was completed on June 6.
Meanwhile, IOI Corp’s share price hit a new two-year low yesterday, down 16 sen, or 4.5%, at RM3.36. It was the second most heavily-traded stock after KNM with 23.39 million shares changing hands.
Shares in IOI Corp, along with big palm oil producers like Sime Darby Bhd and Kuala Lumpur Kepong Bhd, have been under pressure in the past months on declining crude plam oil (CPO) prices.
On Bursa Derivatives, the benchmark third-month contract for CPO fell RM107 to RM1,743 per tonne €“ its lowest since mid-November 2006. Palm oil prices have fallen 43% year-to-date.
Another big loser was Public Bank Bhd, which saw its share price fall 15 sen, or 1.7%, to RM8.90.
Public Bank, currently the biggest bank in terms of market value, said on Tuesday its third-quarter net profit rose 13%, but added that the operating environment would be “more challenging” in the coming months as the local economy was expected to soften in the last quarter and in 2009.
The market will also keep an eye on Tenaga Nasional Bhd today, which is expected to release its results for the financial year ended Aug 31 after the stock market closes.
source: biz.thestar.com.my
By IZWAN IDRIS and YVONNE TAN
PETALING JAYA: Stocks on Bursa Malaysia tumbled yesterday, dragged down by renewed sell-off on blue-chip firms like KNM Group Bhd and IOI Corp Bhd amid worries that falling commodity prices and weaker global growth outlook will hurt earnings.
The KL Composite Index dropped 16.18 points, or 1.7%, to 949.88 points yesterday, which also reflected declines in other regional markets. In Hong Kong, the benchmark Hang Seng index was down 5% and stocks in Singapore fell 3.2%.
Almost all major markets in Asia were lower with shares in South Korea down 2%, while Australian stocks lost 0.8%. In Indonesia, the Jakarta Composite Index retreated 2.2%.
Shares in Japan reversed early losses to end up 1%, rising on the back of a massive 14% jump on Tuesday.
“Investors are pricing in a much slower earnings growth next year,’’ said a fund manager at a local asset management firm.
“Concerns over global recession weigh heavily on the market and this will limit stocks’ upside potential in the near term,” he added.
Shares in KNM, one of the country’s biggest oil and gas fabricators, plunged 21.5 sen, or 24%, yesterday to 69 sen with 154 million shares transacted.
Yesterday’s market volume was 572 million shares.
Analysts said the huge sell-down on KNM was partly due to worries the company was facing a tougher operating environment owing to falling crude oil prices.
Filings with Bursa Malaysia showed the group’s major shareholders, including foreign funds, had aggressively trimmed down their holdings in KNM in recent weeks.
Crude oil in New York yesterday fell to below US$77 per barrel on concerns demand would falter as the financial crisis crippled global economic growth. The crude oil price had plummeted 47% from its peak of US$147 per barrel three months ago.
KNM told Bursa Malaysia yesterday it had accepted Malayan Banking Bhd’s (Maybank) offer of a three-year term loan worth 150 million euros to settle the bridging loan granted by Maybank for the acquisition of German-based Borsig GmbH.
The takeover was completed on June 6.
Meanwhile, IOI Corp’s share price hit a new two-year low yesterday, down 16 sen, or 4.5%, at RM3.36. It was the second most heavily-traded stock after KNM with 23.39 million shares changing hands.
Shares in IOI Corp, along with big palm oil producers like Sime Darby Bhd and Kuala Lumpur Kepong Bhd, have been under pressure in the past months on declining crude plam oil (CPO) prices.
On Bursa Derivatives, the benchmark third-month contract for CPO fell RM107 to RM1,743 per tonne €“ its lowest since mid-November 2006. Palm oil prices have fallen 43% year-to-date.
Another big loser was Public Bank Bhd, which saw its share price fall 15 sen, or 1.7%, to RM8.90.
Public Bank, currently the biggest bank in terms of market value, said on Tuesday its third-quarter net profit rose 13%, but added that the operating environment would be “more challenging” in the coming months as the local economy was expected to soften in the last quarter and in 2009.
The market will also keep an eye on Tenaga Nasional Bhd today, which is expected to release its results for the financial year ended Aug 31 after the stock market closes.
source: biz.thestar.com.my
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