Published: January 2, 2015 10:55 AMUPDATED: January 02, 2015 02:36 pm
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Palm oil rallied this week to the highest level in almost two months on concern the wetter-than-usual weather that stretched from southern Thailand, through Malaysia and into Indonesia may hurt supplies. — Reuters picPalm oil rallied this week to the highest level in almost two months on concern the wetter-than-usual weather that stretched from southern Thailand, through Malaysia and into Indonesia may hurt supplies. — Reuters picKUALA LUMPUR, Jan 2 ― Floods that hurt palm oil production across Malaysia will exacerbate a seasonal decline in output and help to cut inventories, according to CIMB Investment Bank Bhd, which said that it expected prices to remain firm.
The inundation affected about 184,000 hectares (455,000 acres), or about 3.5 per cent of the country’s total planted area, with the states of Kelantan, Pahang and Terengganu worst- hit, analyst Ivy Ng wrote in a report dated today. Output may have dropped 20 per cent to about 1.4 million metric tonnes last month from November, Ng said, citing an estimate from Plantation Industries and Commodities Minister Douglas Uggah Embas.
Palm oil rallied this week to the highest level in almost two months on concern the wetter-than-usual weather that stretched from southern Thailand, through Malaysia and into Indonesia may hurt supplies. The floods displaced hundreds of thousands, damaged infrastructure and prompted the government in Malaysia to prioritize flood-mitigation works. The country is the world’s largest palm oil producer after Indonesia.
“We need an immediate assessment of the damages,” Deputy Prime Minister Muhyiddin Yassin was cited as saying by the New Straits Times today. Infrastructure, such as roads and bridges, was affected, according to Muhyiddin, who was in Perak state overseeing flood-relief efforts.
Palm oil for March delivery was 0.6 per cent lower at RM2,253 a tonne on Bursa Malaysia Derivatives at the midday break in Kuala Lumpur. The price rallied to RM2,308 on December 29, the highest since November 4. Last month it advanced 4.3 per cent, paring an annual decline, as the floodwaters spread.
Lower inventory
“The flood and the seasonally low-production season is likely to exacerbate the drop in crude palm oil output in the December 2014-January 2015 period, leading to lower palm oil inventory,” CIMB’s Ng wrote in the report dated January 2 “This will be positive for near-term crude palm oil prices.”
The flooding affected about 23,730 hectares of estates run by Felda Global Ventures Bhd, or 6.3 per cent of the company’s total planted oil palm estates, and the group estimated losses of about RM21 million, Ng wrote. The company’s shares slumped as much as 5.5 per cent in Kuala Lumpur today.
“Planters that are impacted by the flood will likely see weaker earnings in the fourth quarter of 2014 as the slight rise in crude palm oil price will not be sufficient to offset the drop in output,” Ng wrote. For Felda, the RM21 million loss is equivalent to 6 per cent of CIMB’s full-year net income forecast for the company, according to the report.
Stockpiles outlook
Stockpiles stood at 2.28 million tonnes at the end of November after rising for a fifth month, according to data from the Malaysian Palm Oil Board. The reserves may have contracted to about 2 million tonnes in December, according to an estimate MPOB Director-General Choo Yuen May on December 31.
“The flood news has been discounted by the market,” Faiyaz Hudani, associate vice president at Kotak Commodity Services, said by phone from Mumbai, India today. “There may be some decline in production because of the disruption, but there are good carryover stocks in Indonesia and Malaysia.”
Isolated showers and storms are forecast for Pahang, Kelantan, Terengganu, Johor and Perak over the next seven days, according to data from the Malaysian Meteorological Department posted on its website on January 1.
The number of evacuees declined this week as floodwaters receded. The figure in Pahang, Perak, Terengganu, Kelantan and Johor was at 84,575, down from 91,244 on January 1, according to state news agency Bernama said, citing data from government agencies. ― Bloomberg
- See more at: http://www.themalaymailonline.com/money/article/cimb-expects-palm-oil-prices-to-remain-firm-amid-flood-damage#sthash.JOUM9LCn.dpuf
Palm
oil rallied this week to the highest level in almost two months on
concern the wetter-than-usual weather that stretched from southern
Thailand, through Malaysia and into Indonesia may hurt supplies. —
Reuters picKUALA LUMPUR, Jan 2 ― Floods that hurt palm oil
production across Malaysia will exacerbate a seasonal decline in output
and help to cut inventories, according to CIMB Investment Bank Bhd,
which said that it expected prices to remain firm.The inundation affected about 184,000 hectares (455,000 acres), or about 3.5 per cent of the country’s total planted area, with the states of Kelantan, Pahang and Terengganu worst- hit, analyst Ivy Ng wrote in a report dated today. Output may have dropped 20 per cent to about 1.4 million metric tonnes last month from November, Ng said, citing an estimate from Plantation Industries and Commodities Minister Douglas Uggah Embas.
Palm oil rallied this week to the highest level in almost two months on concern the wetter-than-usual weather that stretched from southern Thailand, through Malaysia and into Indonesia may hurt supplies. The floods displaced hundreds of thousands, damaged infrastructure and prompted the government in Malaysia to prioritize flood-mitigation works. The country is the world’s largest palm oil producer after Indonesia.
“We need an immediate assessment of the damages,” Deputy Prime Minister Muhyiddin Yassin was cited as saying by the New Straits Times today. Infrastructure, such as roads and bridges, was affected, according to Muhyiddin, who was in Perak state overseeing flood-relief efforts.
Palm oil for March delivery was 0.6 per cent lower at RM2,253 a tonne on Bursa Malaysia Derivatives at the midday break in Kuala Lumpur. The price rallied to RM2,308 on December 29, the highest since November 4. Last month it advanced 4.3 per cent, paring an annual decline, as the floodwaters spread.
Lower inventory
“The flood and the seasonally low-production season is likely to exacerbate the drop in crude palm oil output in the December 2014-January 2015 period, leading to lower palm oil inventory,” CIMB’s Ng wrote in the report dated January 2 “This will be positive for near-term crude palm oil prices.”
The flooding affected about 23,730 hectares of estates run by Felda Global Ventures Bhd, or 6.3 per cent of the company’s total planted oil palm estates, and the group estimated losses of about RM21 million, Ng wrote. The company’s shares slumped as much as 5.5 per cent in Kuala Lumpur today.
“Planters that are impacted by the flood will likely see weaker earnings in the fourth quarter of 2014 as the slight rise in crude palm oil price will not be sufficient to offset the drop in output,” Ng wrote. For Felda, the RM21 million loss is equivalent to 6 per cent of CIMB’s full-year net income forecast for the company, according to the report.
Stockpiles outlook
Stockpiles stood at 2.28 million tonnes at the end of November after rising for a fifth month, according to data from the Malaysian Palm Oil Board. The reserves may have contracted to about 2 million tonnes in December, according to an estimate MPOB Director-General Choo Yuen May on December 31.
“The flood news has been discounted by the market,” Faiyaz Hudani, associate vice president at Kotak Commodity Services, said by phone from Mumbai, India today. “There may be some decline in production because of the disruption, but there are good carryover stocks in Indonesia and Malaysia.”
Isolated showers and storms are forecast for Pahang, Kelantan, Terengganu, Johor and Perak over the next seven days, according to data from the Malaysian Meteorological Department posted on its website on January 1.
The number of evacuees declined this week as floodwaters receded. The figure in Pahang, Perak, Terengganu, Kelantan and Johor was at 84,575, down from 91,244 on January 1, according to state news agency Bernama said, citing data from government agencies. ― Bloomberg
Palm
oil rallied this week to the highest level in almost two months on
concern the wetter-than-usual weather that stretched from southern
Thailand, through Malaysia and into Indonesia may hurt supplies. —
Reuters picKUALA LUMPUR, Jan 2 ― Floods that hurt palm oil
production across Malaysia will exacerbate a seasonal decline in output
and help to cut inventories, according to CIMB Investment Bank Bhd,
which said that it expected prices to remain firm.The inundation affected about 184,000 hectares (455,000 acres), or about 3.5 per cent of the country’s total planted area, with the states of Kelantan, Pahang and Terengganu worst- hit, analyst Ivy Ng wrote in a report dated today. Output may have dropped 20 per cent to about 1.4 million metric tonnes last month from November, Ng said, citing an estimate from Plantation Industries and Commodities Minister Douglas Uggah Embas.
Palm oil rallied this week to the highest level in almost two months on concern the wetter-than-usual weather that stretched from southern Thailand, through Malaysia and into Indonesia may hurt supplies. The floods displaced hundreds of thousands, damaged infrastructure and prompted the government in Malaysia to prioritize flood-mitigation works. The country is the world’s largest palm oil producer after Indonesia.
“We need an immediate assessment of the damages,” Deputy Prime Minister Muhyiddin Yassin was cited as saying by the New Straits Times today. Infrastructure, such as roads and bridges, was affected, according to Muhyiddin, who was in Perak state overseeing flood-relief efforts.
Palm oil for March delivery was 0.6 per cent lower at RM2,253 a tonne on Bursa Malaysia Derivatives at the midday break in Kuala Lumpur. The price rallied to RM2,308 on December 29, the highest since November 4. Last month it advanced 4.3 per cent, paring an annual decline, as the floodwaters spread.
Lower inventory
“The flood and the seasonally low-production season is likely to exacerbate the drop in crude palm oil output in the December 2014-January 2015 period, leading to lower palm oil inventory,” CIMB’s Ng wrote in the report dated January 2 “This will be positive for near-term crude palm oil prices.”
The flooding affected about 23,730 hectares of estates run by Felda Global Ventures Bhd, or 6.3 per cent of the company’s total planted oil palm estates, and the group estimated losses of about RM21 million, Ng wrote. The company’s shares slumped as much as 5.5 per cent in Kuala Lumpur today.
“Planters that are impacted by the flood will likely see weaker earnings in the fourth quarter of 2014 as the slight rise in crude palm oil price will not be sufficient to offset the drop in output,” Ng wrote. For Felda, the RM21 million loss is equivalent to 6 per cent of CIMB’s full-year net income forecast for the company, according to the report.
Stockpiles outlook
Stockpiles stood at 2.28 million tonnes at the end of November after rising for a fifth month, according to data from the Malaysian Palm Oil Board. The reserves may have contracted to about 2 million tonnes in December, according to an estimate MPOB Director-General Choo Yuen May on December 31.
“The flood news has been discounted by the market,” Faiyaz Hudani, associate vice president at Kotak Commodity Services, said by phone from Mumbai, India today. “There may be some decline in production because of the disruption, but there are good carryover stocks in Indonesia and Malaysia.”
Isolated showers and storms are forecast for Pahang, Kelantan, Terengganu, Johor and Perak over the next seven days, according to data from the Malaysian Meteorological Department posted on its website on January 1.
The number of evacuees declined this week as floodwaters receded. The figure in Pahang, Perak, Terengganu, Kelantan and Johor was at 84,575, down from 91,244 on January 1, according to state news agency Bernama said, citing data from government agencies. ― Bloomberg
Palm
oil rallied this week to the highest level in almost two months on
concern the wetter-than-usual weather that stretched from southern
Thailand, through Malaysia and into Indonesia may hurt supplies. —
Reuters picKUALA LUMPUR, Jan 2 ― Floods that hurt palm oil
production across Malaysia will exacerbate a seasonal decline in output
and help to cut inventories, according to CIMB Investment Bank Bhd,
which said that it expected prices to remain firm.The inundation affected about 184,000 hectares (455,000 acres), or about 3.5 per cent of the country’s total planted area, with the states of Kelantan, Pahang and Terengganu worst- hit, analyst Ivy Ng wrote in a report dated today. Output may have dropped 20 per cent to about 1.4 million metric tonnes last month from November, Ng said, citing an estimate from Plantation Industries and Commodities Minister Douglas Uggah Embas.
Palm oil rallied this week to the highest level in almost two months on concern the wetter-than-usual weather that stretched from southern Thailand, through Malaysia and into Indonesia may hurt supplies. The floods displaced hundreds of thousands, damaged infrastructure and prompted the government in Malaysia to prioritize flood-mitigation works. The country is the world’s largest palm oil producer after Indonesia.
“We need an immediate assessment of the damages,” Deputy Prime Minister Muhyiddin Yassin was cited as saying by the New Straits Times today. Infrastructure, such as roads and bridges, was affected, according to Muhyiddin, who was in Perak state overseeing flood-relief efforts.
Palm oil for March delivery was 0.6 per cent lower at RM2,253 a tonne on Bursa Malaysia Derivatives at the midday break in Kuala Lumpur. The price rallied to RM2,308 on December 29, the highest since November 4. Last month it advanced 4.3 per cent, paring an annual decline, as the floodwaters spread.
Lower inventory
“The flood and the seasonally low-production season is likely to exacerbate the drop in crude palm oil output in the December 2014-January 2015 period, leading to lower palm oil inventory,” CIMB’s Ng wrote in the report dated January 2 “This will be positive for near-term crude palm oil prices.”
The flooding affected about 23,730 hectares of estates run by Felda Global Ventures Bhd, or 6.3 per cent of the company’s total planted oil palm estates, and the group estimated losses of about RM21 million, Ng wrote. The company’s shares slumped as much as 5.5 per cent in Kuala Lumpur today.
“Planters that are impacted by the flood will likely see weaker earnings in the fourth quarter of 2014 as the slight rise in crude palm oil price will not be sufficient to offset the drop in output,” Ng wrote. For Felda, the RM21 million loss is equivalent to 6 per cent of CIMB’s full-year net income forecast for the company, according to the report.
Stockpiles outlook
Stockpiles stood at 2.28 million tonnes at the end of November after rising for a fifth month, according to data from the Malaysian Palm Oil Board. The reserves may have contracted to about 2 million tonnes in December, according to an estimate MPOB Director-General Choo Yuen May on December 31.
“The flood news has been discounted by the market,” Faiyaz Hudani, associate vice president at Kotak Commodity Services, said by phone from Mumbai, India today. “There may be some decline in production because of the disruption, but there are good carryover stocks in Indonesia and Malaysia.”
Isolated showers and storms are forecast for Pahang, Kelantan, Terengganu, Johor and Perak over the next seven days, according to data from the Malaysian Meteorological Department posted on its website on January 1.
The number of evacuees declined this week as floodwaters receded. The figure in Pahang, Perak, Terengganu, Kelantan and Johor was at 84,575, down from 91,244 on January 1, according to state news agency Bernama said, citing data from government agencies. ― Bloomberg
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