Archives
Comments & Feedbacks
Other MPOB Publications
Search
Get Acrobat Reader

Volume 4 Number 2/2004
Published in March 2004 by the  Malaysian Palm Oil Board

TABLE OF CONTENTS

Impacts of CPO-Export Tax on Several Aspects of Indonesian CPO Industry
by Wayan R Susila
Full text [PDF 507KB] Abstract

Comparative Advantage of the European Rapeseed Industry vis-a-vis Other Oils and Fats Producers
by Mohd Arif Simeh
Full text [PDF 473KB] Abstract

Improving the Price Forecast of Crude Palm Oil Futures Using Historical Return Variances
by Azmi Omar and Shamsul Majid
Full text [PDF 461KB] Abstract

Economic Feasibility of Organic Palm Oil Production in Malaysia
by Ahmad Borhan A Nordin; Mohd Arif Simeh; Mohd nasir Amiruddin; Chan Kook Weng and Burhanuddin Abdul Salam
Full text [PDF 473KB] Abstract
 

 


 
Comments & Feedbacks:
Oil Palm Industry Economic Journal is published twice a year
in September and March by the
Malaysian Palm Oil Board (MPOB)
http://mpob.gov.my

Views of writers expressed in this publication are not necessarily those of MPOB.

MPOB welcomes contributions and comments from all individuals and organizations.  Its inclusion is however, the prerogative of the Director-General of MPOB.

Contributions and comments should be addressed to :

Director-General
MPOB
P.O. Box 8073
46781 Kelana Jaya
Selangor
Malaysia

venu@mpob.gov.my

Material from this publication may be freely used or reproduced, provided the source of information is accurately recorded and acknowledgements made to the Malaysian Palm Oil Board

This online publication is electronically compiled by Palm Information Centre, MPOB
fatimah@mpob.gov.my
afdzan@mpob.gov.my

 
ABSTRACT
Impacts of CPO-Export Tax on Several Aspects of Indonesian CPO Industry
To control domestic supply and price of crude palm oil (CPO) and cooking oil, the government of Indonesia has imposed CPO-export tax since August 1994. As the CPO industry plays an important role in Indonesian economy, the imposition of the tax is expected to have substantial impacts on various aspects of the industry, such as on investment, production, trade, farm income and welfare distribution. The main objective of this study is to assess these impacts using an econometric model of the industry. The results of the study reveal that the export tax policy has inhibited the growth rate of investment, production, export and farm income. On the other hand, this policy has been an effective instrument to control domestic CPO and cooking oil price. Moreover, this policy has caused a substantial welfare transfer from producers to consumers and the government. To compromise these conflicting impacts, an alternative CPO tax formula is also proposed in this paper.

Top

Comparative Advantage of the European Rapeseed Industry vis-a-vis Other Oils and Fats Producers
Rapeseed production in Europe currently constitutes to nearly one-third of the world output of about 28 million tonnes although its area is three times smaller than that in China. This paper attempts to assess its competitiveness vis-à-vis 26 other oils and fats producing countries [with special reference to other rapeseed oil producers, the least cost producer of vegetable oil and Malaysia (in the production of palm oil)]. Three economic comparisons will be used, i.e.; economic advantage, comparative advantage and structural competitiveness.

Top

Improving the Price Forecast of Crude Palm Oil Futures Using Historical Return Variances
This paper attempts to investigate the price relationship between the spot and futures prices of crude palm oil contracts traded in the Malaysian Derivatives Exchange. Using historical variances of spot and futures price returns, we applied a model for approximating the convenience yield developed by Longstaff (1995). This model was then tested on the actual crude palm oil prices for the spot-month and three-month contracts from January 1988 to December 2002, to determine the forecasting accuracy of this model relative to the simple cost-of-carry model. There was some improvement in the predictive ability of this approach which could be attributed to the inclusion of historical return variances. The improvement was also evident when tested against out-of-sample data, suggesting that the inclusion of historical return variances in the form of the convenience yield could provide a better forecast of crude palm oil futures prices.

Top

Economic Feasibility of Organic Palm Oil Production in Malaysia
The importance of organic farming has increased due to its environmentally friendly methods and growing consumer awareness of food safety. Based on estimates, world retail sales of organic foods will reach USD 29-USD 31 billion in 2005. Producing palm oil by organic cultivation is highly possible in Malaysia since many oil palm agronomic practices in the country already have minimum environmental impacts and are moving towards even more eco-friendly methods. The command of a premium price is the main attraction for investment in organic food production.

Top