Countdown to PIPOC 2017
Search
LIST OF ARTICLES

PDF of individual article can be purchased from Palm Information Centre, MPOB
Tel: 603-8769 4928 Fax: 603-8925 4213 Email: palmoils@mpob.gov.my

Article Info

Vol 12 No.2 (2012) p22-35
The Economic Impact of the North-east Monsoon and La Niña on Oil Palm Production in Malaysia
Ayat K Ab Rahman*; Ramli Abdullah* and Faizah Mohd Shariff

Download PDF

Abstract


The Economic Impact of the North-east Monsoon and La Niña on Oil Palm Production in Malaysia

La Niña, which occurs during the north-east monsoon season, normally brings higher rainfall than during normal weather in Malaysia. This study shows that La Niña had caused flooding in some oil palm planted areas in the past. The floods in effect disrupted harvesting and collecting activities and fresh fruit bunches (FFB) on the oil palm left overripe or become rotten. Crude palm oil (CPO) production declined and reduced income of oil palm growers. The potential losses of FFB by oil palm estates during La Niña in 2010 and 2011 were estimated to be about 239 181 t and 224 776 t respectively. In term of potential income losses, they were estimated at RM 155.10 million and RM 168.22 million during the two years. One of the reasons for the increase in the cost of FFB production was the damage of infield roads during floods. Hence, floods affected estates had spent RM 25.80 million and RM 26.48 million to repair the roads in 2010 and 2011 respectively. This study also showed that CPO production depends negatively with a dummy variable used to proxy La Niña. In the absence of La Niña, CPO production in 2010 should have been around 17.60 million tonnes when the actual CPO production during the year registered at only 16.99 million tonnes. The total potential CPO production loss was estimated to decline by 3.5% and 2.2%, as compared to production without La Niña in 2010 and 2011 respectively.


Keyword(s): OIL PALM; OIL PALM PRODUCTION - Malaysia; LA NINA;

Download PDF

Article Info

Vol 12 No.2 (2012) p14-21
Supply and Demand Performance for the Oils and Fats Industry in Malaysia
Ahmad Borhan A Nordin; Faizah Mohd Shariff; N Balu and Nik Abdullah Nik Idris

Download PDF

Abstract


Supply and Demand Performance for the Oils and Fats Industry in Malaysia

Malaysia was the world’s second largest palm oil producer, but it was the leading exporter of the oil in 2011. The country had exported nearly 18 million tonnes of palm oil, 3.4 million tonnes of palm kernel oil, 2.2 million tonnes of oleochemicals, 0.4 million tonnes of finished products and nearly 0.3 million tonnes of other palm-based products. Meanwhile, the imports of edible oils and fats, including palm oil had nearly doubled from 1.1 million tonnes in 2005 to 2.1 million tonnes in 2011. Imports of palm oil had grown from 26% in 2005 to 61% in 2011, while imports of palm kernel oil had tripled over the same period. Imports of soyabean, canola/rapeseed and sunflower oils had increased, with their total combined volume increasing to 0.26 million tonnes in 2011 from 0.16 million tonnes in 2005. Only the import of coconut oil had declined from 0.24 million tonnes in 2005 to 0.16 million tonnes in 2011. This scenario indicated that palm oil still played a major role in the demand performance of edible oils and fats in Malaysia. However, arising from higher disposable income and traditional taste preference for premium soft oils, the demand for soyabean, canola/rapeseed and sunflower oils have seen increases in their consumption patterns in recent years.

Keyword(s): OILS AND FATS; SUPPLY; DEMAND; PALM OIL INDUSTRY - Malaysia

Download PDF

Article Info

Vol 12 No.2 (2012) p1-13
The Growth and Prospects for the Oil Palm Plantation Industry in Indonesia
Helena Varkkey

Download PDF

Abstract


The Growth and Prospects for the Oil Palm Plantation Industry in Indonesia

This article provides a historical political economy perspective of the Indonesian oil palm plantation sector. It aims to shed light on the process of how Indonesia took over from Malaysia in becoming the world’s current largest producer of palm oil. This article argues that the regional trend of state-led development that relied on agribusiness as a major sector played a major role in the development of oil palm as an important crop in the region, especially in Malaysia and Indonesia. Indonesia specifically promoted and encouraged the expansion of oil palm as a way to fulfill state developmental aims; identifying it as a lucrative source of revenue, foreign exchange, and rural employment. With oil palm playing such an important role in the Indonesian economy, the state has outlined plans for rapid area expansion, to maintain its world dominance in the sector. Malaysian and Singaporean companies are currently major players in the Indonesian oil palm plantation sector, and continue to reap the benefits of this lucrative crop alongside local firms.

Keyword(s):

Download PDF

Article Info

Vol 12 No.1 (2012) p24-30
Economic Impact of Ganoderma Incidence on Malaysian Oil Palm Plantation – A Case Study in Johor
Roslan Abas and Idris Abu Seman

Download PDF

Abstract


Economic Impact of Ganoderma Incidence on Malaysian Oil Palm Plantation – A Case Study in Johor

Crop losses due to pest and disease infestations are major threats to agricultural development. For export oriented commodities such as palm oil, the problem of pests and diseases (P&D) cannot be viewed in isolation because it can affect international cost competitiveness as well as revenue losses. The objective of this article is to estimate revenue losses due to FFB yield reduction as a result of Ganoderma attack. From the study, it was found that Ganoderma attack can lead to fresh fruit bunches (FFB) yield reduction between 0.04 t and 4.34 t/ha on 10 years to 22 years of planting respectively. Based on annual growth of Ganoderma incidence rate, it was estimated that in 2020, a total of 400 thousand hectares could be affected.

Keyword(s): OIL PALM PLANTATIONS-Malaysia; GANODERMA; ECONOMIC IMPACT; PESTS AND DISEASES

Download PDF

Article Info

Vol 12 No.1 (2012) p14-23
The Impact of Renewable Fuel Standard (RFS2) on Palm Biodiesel’s Market Access to the United States of America
Rosidah Radzian

Download PDF

Abstract


The Impact of Renewable Fuel Standard (RFS2) on Palm Biodiesel’s Market Access to the United States of America

On 26 March 2010, the Environmental Protection Agency (EPA) published final changes to the RFS2 programme as required by the Energy Independence and Security Act (EISA) of 2007. EISA has targeted 117 million tonnes (36 billion gallons) of renewable fuel to be blended into transportation by 2022. The Act also introduced new eligibility of volume requirements for the four categories of renewable fuel. The most significant aspect of the RFS2 programme is the inclusion of life cycle analysis for greenhouse gas (GHG) emissions to qualify as a renewable fuel. The life cycle analysis of GHG emissions must be lower than the 2005 baseline average for gasoline or diesel fuel that it replaces. Four different levels of reductions are required for the four different renewable fuel standards. These include 20% for conventional renewable fuels, 50% for advanced biofuel, 50% for biomass-based diesel and 60% for cellulosic biofuels. RFS2 regulation came into effect on 1 July 2010. For 2012, the statutory volume requirement is 3.25 million tonnes (1.0 billion gallons) and a minimum of 3.25 million tonnes/year (1.0 billion gallons) of biomass-based diesel is targeted from 2013 through 2022. The proposed volume for 2013 is 4.02 million tonnes (1.238 billion gallons). Currently, feedstocks for biodiesel already approved by EPA included soyabean oil, algal oil, biogenic waste oils/fats/yellow grease, corn oil from DGS and canola oil. Palm-based biodiesel, wood pulp ethanol and grain sorghum ethanol are still under review by EPA. Notice of Data Availability (NODA) for palm oil was published on 27 January 2012. Based on EPA’s analysis, palm-based biodiesel fails to meet the minimum requirement of GHG emission saving of 20%, thus, does not qualify as renewable biofuel under RFS2; palm-based biodiesel and renewable diesel only reduce GHG emission by 17% and 11% respectively. For palm-based biodiesel to be categorised under biomass-based diesel (D4 RIN), it must comply with 50% GHG saving compared to 2005 baseline of petroleum diesel. Malaysian government and other interested parties must submit their comments during the rule-making process to influence EPA on their modeling of palm pathway. Only one pathway will be approved for palm-based biodiesel regardless of its origin in the final rule-making process. If palm NODA is approved by EPA in the final rule-making process, the future for palm-based biodiesel and renewable diesel in the US renewable energy market are non-existence. The reinstatement of USD 1/gallon tax credit for 2011 has given a boost for the biodiesel industry in the US and the production of biodiesel in 2011 exceeded 3.25 million tonnes (1.0 billion gallons). The extension of biodiesel tax credit for 2012 is being debated after it expired on 31 December 2011 and the prospect of US biodiesel industry in 2012 will be more challenging without the extension of the tax credit.

Keyword(s): PALM BIODIESEL; ENVIRONMENTAL PROTECTION AGENCY (EPA); RENEWABLE FUEL STANDARD (RFS2); MARKET ACCESS-United States of America

Download PDF

Article Info

Vol 12 No.1 (2012) p8-13
Internationalisation of Malaysian Palm Oil-based Multinationals
Anuar Md Nor

Download PDF

Abstract


Internationalisation of Malaysian Palm Oil-based Multinationals

This article highlights the internationalisation strategies of selected Malaysian palm oil firms. These Malaysian palm oil multinationals which we call palm oil-based multinationals (POB MNE) are undertaking foreign direct investments (FDI) in developing as well as developed countries. The motives of their FDI are explained using the internationalisation theory. The internationalisation of POB MNE will require new roles for key institutions supporting the Malaysian palm oil industry. This is especially in the case of MPOB which undertakes research activities which are funded from cess levied on the palm oil industry.

Keyword(s): OIL PALM INDUSTRY-Malaysia; INTERNATIONALISATION; FOREIGN DIRECT INVESTMENTS (FDI)

Download PDF

Article Info

Vol 12 No.1 (2012) p1-7
A Study on Inventory Management of Malaysian Palm Oil Products
Ahmad Borhan A Nordin

Download PDF

Abstract


A Study on Inventory Management of Malaysian Palm Oil Products

Inventory management is important to balance organisational objectives, particularly on the appropriate level of stock for raw materials and production outputs as well. The amount of inventory has a direct impact on the responsiveness and efficiency of operations of a company. In general, it can reflect also on the performance of an industry. In the Malaysian palm oil industry, most of the processing activities are well-planned or geared towards fulfilling order as demanded or known as ‘back-to-back’ approach. Hence, the movements of palm products along the supply chain are rather fast to reach respective buyers on time. As a result, the inventory levels of palm products should be low but enough to meet the demand of processing activities.

Keyword(s): PALM OIL PRODUCTS; INVENTORY MANAGEMENT; STOCK LEVEL; PRODUCTION OUTPUTS

Download PDF

Article Info

Vol 11 No.2 (2011) p36-48
An Examination of Sources of Instability in Export Earnings of Malaysian Palm Oil
Ramli Abdullah

Download PDF

Abstract


An Examination of Sources of Instability in Export Earnings of Malaysian Palm Oil

Malaysian export earnings from the animal and vegetable oils and fats sector had been fluctuated in the past. The major component of this sector is obviously that of palm oil which is also highly volatile and in tandem with the total earnings from the animal and vegetable oils and fats sector. It is the aim of this article to assess the instability of the Malaysian palm oil export earnings by using one of the latest techniques in modeling called generalized autoregressive conditional heteroskedasticity (GARCH). The model shows that palm oil export earnings is really instable. Sources of the instability were then sought through literature and the key determinants of the instability are prices of crude palm oil (CPO) and soyabean oil, exchange rate, palm oil export volume and production, and gross domestic products (GDP) of Malaysia’s major trading partners. These key determinants were linked in a multivariate regression model with the export earnings. Results showed that the most significant factors are prices of CPO and soyabean oil. Thus, price of palm oil had played a major role in causing the instability of the Malaysian palm oil export earnings. To stabilise the earnings, one needs to stabilise first the price of palm oil in the market which is exposed to the vagaries of market forces of supply and demand.

Keyword(s): PALM OIL; EXPORT EARNINGS-Malaysia; GENERALIZED AUTOREGRESSIVE CONDITIONAL HETEROSKEDASTICITY (GARCH); SUPPLY AND DEMAND

Download PDF

Article Info

Vol 11 No.2 (2011) p26-35
Free Trade Agreement – The Way Forward for the Malaysian Palm Oil Industry
N Balu and Nazlin Ismail

Download PDF

Abstract


Free Trade Agreement – The Way Forward for the Malaysian Palm Oil Industry

Free Trade Agreements (FTA) have gained prominence in recent years arising from the long delayed conclusion of the World Trade Organisation (WTO) Agriculture and Non-agriculture Negotiations (NAMA). However, member countries of the WTO are keen on fostering greater trade liberalisation with their major trading partners, either bilaterally or regionally to enhance greater market access opportunities. In this context, although Malaysia is a late starter to FTA, it has picked up rather aggressively of late. Malaysia thus far has been involved in the successful completion of five bilateral and regional FTA respectively, both of which have proven to a large extent increased trade dealings and the removal or reductions of trade impediments, especially high tariffs, coupled with increased market access opportunities through flexible rules of origin (ROO). This article will attempt to provide the importance of FTA, features of FTA and the involvement of Malaysia in FTA, both concluded and currently under negotiations.

Keyword(s): FREE TRADE AGREEMENT(FTA); TRADE LIBERALISATION-Malaysia; MARKET ACCESS

Download PDF

Article Info

Vol 11 No.2 (2011) p13-25
World Palm Oil Supply, Demand, Price and Prospects: Focus on Malaysian and Indonesian Palm Oil Industries
Ramli Abdullah

Download PDF

Abstract


World Palm Oil Supply, Demand, Price and Prospects: Focus on Malaysian and Indonesian Palm Oil Industries

The oils and fats sector had shown that both its production and consumption had increased at almost the same rate in the past. Any differences between them will indicate either an oversupply or shortage situation of oils and fats in the world; oversupply occurred when production exceeded consumption and shortage when the situation was reversed. Thus, world production and consumption of oils and fats in 1976 were 45.9 and 47.3 million tonnes respectively (shortage) while in 2010 both were at about 171.2 million tonnes (almost equilibrium). Among the 17 oils and fats, palm oil has expanded the most in the production and consumption of the oils and fats. It began as one of the
minor oils being produced and consumed in 1976 (1.6% and 6% of the world production and consumption of oils and fats respectively) and gradually surged to become the largest produced and consumed oil in 2010 (both at about 28% of the world production and consumption of oils and fats). Palm oil will continue to be the main oil produced and consumed due to its high productivity, cheaper price and healthiness. Its production in Malaysia is expected to be about 18.33 million tonnes while Indonesia will produce about 24.91 million tonnes in 2011. As Malaysia has a constrain to expand its oil palm area due to lack of suitable land, increase in future production is expected to be through increase in its productivity. Palm oil price is associated closely with its main competitor, soyabean oil, and lately crude petroleum price also had an influence. However, there are other factors that need to be considered in evaluating price of palm oil. Taking them into consideration, price is projected at RM 3217 t in 2011 with the first half of year being higher than the second half.

Keyword(s): PALM OIL; SUPPLY AND DEMAND; PROSPECTS; OIL PALM INDUSTRY-Malaysia; OIL PALM INDUSTRY-Indonesia

Download PDF

© Malaysian Palm Oil Board (MPOB). All Rights reserved.
No part of this publication may be reproduced, stored in a retrieval system,
in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without prior written permission of the publisher.

This online publication is electronically compiled by Palm Information Centre, Malaysian Palm Oil Board (MPOB)
Page 4 of 13

Menu

Subscribed Resources

e-RESOURCES

e-BOOKS 

 

2017 SUBSCRIBED TITLES

TITLE LIST

USER GUIDE

Updated on 18 January 2017

Daily CPO Prices

Quick Links


                 


      

              
Copyright © 2017 PALMOILIS Portal. All Rights Reserved.
Designed & Developed by Palm Information Centre, MPOB. Contact webmaster

Visitor Counter

017290
TodayToday34
YesterdayYesterday89
This WeekThis Week441
This MonthThis Month1909
All DaysAll Days17290