Palm oil refineries in Lahad Datu unaffected by security forces’ offensive

Palm oil refineries in Lahad Datu, Sabah, are not affected by the security forces’ offensive against the Sulu intruders yesterday, Plantation Industries and Commodities Minister Tan Sri Bernard Dompok said yesterday.

“No refineries have shut down and none are affected as they are far away from the hostilities,” he said when asked to comment on a newswire report quoting refinery officials that three palm oil refineries have ceased operations on concerns over prolonged security unrest at the area.

Singapore’s Wilmar International and Malaysia’s Kuala Kumpur Kepong Bhd and Kwantas Corp owned the refineries and have slowed down operations following the attack on Malaysian security forces in Lahad Datu and Semporna.

Sabah, which has 1.8 million hectares or about 40 per cent of Malaysia’s palm oil cultivated area, accounted for a quarter of Malaysia’s 18.8 million tonnes of crude palm oil production last year.

Sabah is the main disembarkation point of Malaysia’s palm oil to China. The world’s second largest economy bought three to four million tonnes of palm oil and palm oil-derived products from Malaysia last year.

The most affected plantation company is likely to be Felda Global Ventures Holdings Bhd whose oil palm estates and one refinery are the closest to the village where the armed group have been holed up for the past three weeks.

Its President and Chief Executive Officer Datuk Sabri Ahmad, however, declined to comment when met at the Palm and Lauric Oils Conference and Exhibition: Price Outlook 2013/2014 here yesterday.

The army and the air force launched air and ground attacks early yesterday to flush out the armed Sulu intruders holed up at the coastal Kampung Tanduo and surrounding areas to end the standoff.

At least 27 people have been killed and the standoff has sparked fears of broader insecurity in the resource-rich area.

Earlier, in his speech, Dompok urged palm oil industry players not to be complacent when trading in a competitive market, as palm oil prices have been fluctuating against the backdrop of prevailing supply and demand situations as well as strong competition from 17 other oils.

The minister said the global economic slowdown recorded in the third quarter has contributed towards increasing domestic stocks level, which has resulted in lower crude palm oil (CPO) prices as compared to 2011.

“In this context, the Malaysian Government has implemented measures to enhance competitiveness of the oil palm industry, including restructuring export duty for CPO and providing replanting incentives beginning this year.

This move is aimed at reducing CPO stocks and strengthening its prices,” he said in his keynote address.

In price uncertainty situations, price discovery is necessary for traders, especially in mitigating risk factors, said Dompok, adding that Malaysia as the preferred benchmark for the pricing of palm oil globally, has attracted strong attention from international traders.

As of Dec 31 last year, foreign trading participation for CPO futures contracts were recorded at 30.2 per cent, up 28.7 per cent in 2011.

Source: New Sabah Times

Palm oil refineries in Lahad Datu, Sabah, are not affected by the security forces’ offensive against the Sulu intruders yesterday, Plantation Industries and Commodities Minister Tan Sri Bernard Dompok said yesterday.

“No refineries have shut down and none are affected as they are far away from the hostilities,” he said when asked to comment on a newswire report quoting refinery officials that three palm oil refineries have ceased operations on concerns over prolonged security unrest at the area.

Singapore’s Wilmar International and Malaysia’s Kuala Kumpur Kepong Bhd and Kwantas Corp owned the refineries and have slowed down operations following the attack on Malaysian security forces in Lahad Datu and Semporna.

Sabah, which has 1.8 million hectares or about 40 per cent of Malaysia’s palm oil cultivated area, accounted for a quarter of Malaysia’s 18.8 million tonnes of crude palm oil production last year.

Sabah is the main disembarkation point of Malaysia’s palm oil to China. The world’s second largest economy bought three to four million tonnes of palm oil and palm oil-derived products from Malaysia last year.

The most affected plantation company is likely to be Felda Global Ventures Holdings Bhd whose oil palm estates and one refinery are the closest to the village where the armed group have been holed up for the past three weeks.

Its President and Chief Executive Officer Datuk Sabri Ahmad, however, declined to comment when met at the Palm and Lauric Oils Conference and Exhibition: Price Outlook 2013/2014 here yesterday.

The army and the air force launched air and ground attacks early yesterday to flush out the armed Sulu intruders holed up at the coastal Kampung Tanduo and surrounding areas to end the standoff.

At least 27 people have been killed and the standoff has sparked fears of broader insecurity in the resource-rich area.

Earlier, in his speech, Dompok urged palm oil industry players not to be complacent when trading in a competitive market, as palm oil prices have been fluctuating against the backdrop of prevailing supply and demand situations as well as strong competition from 17 other oils.

The minister said the global economic slowdown recorded in the third quarter has contributed towards increasing domestic stocks level, which has resulted in lower crude palm oil (CPO) prices as compared to 2011.

“In this context, the Malaysian Government has implemented measures to enhance competitiveness of the oil palm industry, including restructuring export duty for CPO and providing replanting incentives beginning this year.

This move is aimed at reducing CPO stocks and strengthening its prices,” he said in his keynote address.

In price uncertainty situations, price discovery is necessary for traders, especially in mitigating risk factors, said Dompok, adding that Malaysia as the preferred benchmark for the pricing of palm oil globally, has attracted strong attention from international traders.

As of Dec 31 last year, foreign trading participation for CPO futures contracts were recorded at 30.2 per cent, up 28.7 per cent in 2011. oil refineries in Lahad Datu, Sabah, are not affected by the security forces’ offensive against the Sulu intruders yesterday, Plantation Industries and Commodities Minister Tan Sri Bernard Dompok said yesterday.

“No refineries have shut down and none are affected as they are far away from the hostilities,” he said when asked to comment on a newswire report quoting refinery officials that three palm oil refineries have ceased operations on concerns over prolonged security unrest at the area.

Singapore’s Wilmar International and Malaysia’s Kuala Kumpur Kepong Bhd and Kwantas Corp owned the refineries and have slowed down operations following the attack on Malaysian security forces in Lahad Datu and Semporna.

Sabah, which has 1.8 million hectares or about 40 per cent of Malaysia’s palm oil cultivated area, accounted for a quarter of Malaysia’s 18.8 million tonnes of crude palm oil production last year.

Sabah is the main disembarkation point of Malaysia’s palm oil to China. The world’s second largest economy bought three to four million tonnes of palm oil and palm oil-derived products from Malaysia last year.

The most affected plantation company is likely to be Felda Global Ventures Holdings Bhd whose oil palm estates and one refinery are the closest to the village where the armed group have been holed up for the past three weeks.

Its President and Chief Executive Officer Datuk Sabri Ahmad, however, declined to comment when met at the Palm and Lauric Oils Conference and Exhibition: Price Outlook 2013/2014 here yesterday.

The army and the air force launched air and ground attacks early yesterday to flush out the armed Sulu intruders holed up at the coastal Kampung Tanduo and surrounding areas to end the standoff.

At least 27 people have been killed and the standoff has sparked fears of broader insecurity in the resource-rich area.

Earlier, in his speech, Dompok urged palm oil industry players not to be complacent when trading in a competitive market, as palm oil prices have been fluctuating against the backdrop of prevailing supply and demand situations as well as strong competition from 17 other oils.

The minister said the global economic slowdown recorded in the third quarter has contributed towards increasing domestic stocks level, which has resulted in lower crude palm oil (CPO) prices as compared to 2011.

“In this context, the Malaysian Government has implemented measures to enhance competitiveness of the oil palm industry, including restructuring export duty for CPO and providing replanting incentives beginning this year.

This move is aimed at reducing CPO stocks and strengthening its prices,” he said in his keynote address.

In price uncertainty situations, price discovery is necessary for traders, especially in mitigating risk factors, said Dompok, adding that Malaysia as the preferred benchmark for the pricing of palm oil globally, has attracted strong attention from international traders.

As of Dec 31 last year, foreign trading participation for CPO futures contracts were recorded at 30.2 per cent, up 28.7 per cent in 2011.