United call for government help

这“六方会谈”，只是一出谍对谍的戏。
谎言一，六个月不施肥。中国就快撤销肥料出口税了，到时不懂会跌多少。
谎言二，要求国能“烧”棕油。
谎言三，5% blending biodiesel。可能实施，但要等。

如果再往悲观处想，推论是，至少要等大片大片的土地收购，他们才会把CPO价格推高。

Source: The Star, 25 Nov 2008

Planters want scheme to reduce palm oil stocks

BANGI: Six top local plantation companies are seeking the Government’s assistance to work out an incentive programme to enable crude palm oil (CPO) to be used as an energy source in the industrial sector in a bid to reduce palm oil stocks and stabilise prices.

The planters - IOI Corp Bhd, Sime Darby Bhd, Kuala Lumpur Kepong Bhd (KLK), Boustead Holdings Bhd, Felda Holdings Bhd and United Plantations Bhd - will be working closely with the Malaysian Palm Oil Board (MPOB).

They are considering not using fertilisers for the next six months if the current fertiliser price does not fall further. They will also reduce CPO production by 700,000 tonnes by February next year via a replanting exercise covering 200,000ha.

The six companies represent almost 60% of the country’s CPO annual production of about 17.5 million tonnes.

KLK chief executive officer Datuk Seri Lee Oi Hian told a press conference yesterday that the industry players wanted those in the oleochemicals, steel, textile, processing and energy sectors to consider using palm methyl ester as an alternative fuel instead of natural gas and diesel.

MPOB chairman Datuk Sabri Ahmad noted that the board would study the proposal by planters and help them with the submission to the Government.

“Planters want Tenaga Nasional Bhd to help burn CPO as energy. This will not so much be in Peninsular Malaysia but perhaps in Sabah,” he added.

IOI Corp group executive chairman Tan Sri Lee Shin Cheng, meanwhile, reiterated the importance of replanting efforts, expediting the 5% palm methyl ester blend with diesel and refraining from using fertiliser for the next six months.

Felda Holdings group managing director Datuk Mohd Bakke Salleh said the group would be focusing on increasing its CPO exports by penetrating new markets next year.

Taking account of the 15% cut in fertiliser price, Malaysia Estate Owners’ Association president Boon Weng Siew said planters with 30 tonnes of fresh fruit bunches (FFB) per ha per year would have less difficulty in weathering the storm.

This is because the cost of CPO production was estimated at RM1,085 per tonne compared with RM1,264 and RM1,495 in the case of plantations with average yield of 25 tonnes and 20 tonnes of FFB per ha per year respectively.

“Assuming fertiliser price can be reduced by 50%, the CPO production costs of the three classes of plantations can be brought down to a more tenable level of RM840, RM970 and RM1,145 per tonne respectively,” he said.

Sime Darby plantations division managing director Datuk Azhar Abdul Hamid said: “We appreciate the government efforts to push for biodiesel. The 5% blending will be good and the market will react positively.”

He said there should be a balance for palm oil, both in terms of food and fuel usage. “Our priority will be for food,” he added.

Sabri noted that the Government had allocated RM200mil of the total RM500mil in cess for palm oil price stabilisation to support the biodiesel initiative.

On CPO prices, the planters concurred that a fair value should be RM2,000 to RM2,500 per tonne based on the current average cost of production, from about RM1,200 per tonne currently. However, at current CPO price of RM1,500 per tonne, KLK’s Lee said: “Efficient planters are still making profits and not distressed yet.”