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Great! Indonesia-Malaysia Ready to Export Palm Oil to China

29

Aug

Great! Indonesia-Malaysia Ready to Export Palm Oil to China

“We agreed to collaborate to encourage China to use B5, which will in turn reduce trade deficit with Indonesia and Malaysia and [...]

Great! Indonesia-Malaysia Ready to Export Palm Oil to China. “We agreed to collaborate to encourage China to use B5, which will in turn reduce trade deficit with Indonesia and Malaysia and support environmentally friendly energy,” said Indonesia's Ministry of Industry Airlangga Hartarto after attending a meeting with Malaysia's Minister of Plantation Industries and Commodities, Datuk Seri Mah Siew Keong, in Putrajaya, Malaysia.
 
The Minister of Industry expects that China's use of biodiesel will be a potential market for increasing Indonesian palm oil exports. It could even become an opportunity for national industry players to invest in building biodiesel factories. “Palm oil is one of Indonesia's and Malaysia's strategic commodities. The success or failure of this commodity rests in the hands of both countries as suppliers of 90 percent of CPO to the global market,” he said.
 
Therefore, the Indonesian Ministry of Industry focuses on encouraging the development of the domestic CPO industry through downstream processing, which will increase high added value. “Indonesia produced around 35 million tons of CPO in 2016. Development of the downstream industry in palm oil processing includes products such as palm oil cooking oil, oleofood, oleochemicals, and even biofuel,” explained Airlangga.
 
In 2016, the national production capacity for cooking oil reached 45 million tons per year, oleofood 2.5 million tons per year, oleochemicals 3.5 million tons per year, and biodiesel 10.75 million tons per year. Meanwhile, exports of CPO and its derivative products reached USD4.1 million from January to February 2017, an increase of 63 percent compared to the same period in 2016.
 
Airlangga continued by saying that in the bilateral meeting, both parties also agreed to strengthen the institutional framework for the Council of Palm Oil Producing Countries (CPOPC). “We encourage this institution to leverage added value or downstream industries in the CPO industry,” he said.
 
The CPOPC will invite seven other countries to join as CPO producers: Thailand, Colombia, Nigeria, Papua New Guinea, Ivory Coast, Honduras, and Guatemala. “We also invited them to attend the FGD, which will be held soon in Bali,” Airlangga added. The inclusion of those countries is expected to have a positive impact on the global CPO commodity.

In the First Semester, Palm Oil Exports to the European Union Grew by 42%

29

Aug

In the First Semester, Palm Oil Exports to the European Union Grew by 42%

"The increase is quite significant, considering Europe is implementing trade barriers by issuing the European Parliament's resolution last March," [...]

In the First Semester, Palm Oil Exports to the European Union Grew by 42%. `The increase is quite significant, considering Europe is implementing trade barriers by issuing the European Parliament's resolution last March,` said Gapki Executive Director Fadhil Hasan in a written statement. In addition to Europe, Gapki recorded that the export performance in semester I/2017 generally grew positively. The national palm oil export volume in semester I/2017 reached 16.6 million tons or increased by 25% compared to the same period last year by 12.5 million tons. The exports to primary destination countries also grew positively except for Pakistan. Exports in semester I to Pakistan were recorded to go down by 5% compared to the same period in 2016 from 1.1 million tons in 2016 to 1.05 million tons this year. However, the export volume of Indonesian palm oil to India in semester I/2017 grew quite significantly, which increased by 43% compared to the same period last year from 2.6 million tons to 3.8 million tons. The export increase also occurred in the African countries market by 36.5%, Bangladesh by 29%, the United States by 27%, and China by 18%. In another part, the Minister of Industry (Menperin) Airlangga Hartarto said that Indonesia and Malaysia are ready to synergize in fulfilling palm oil needs to support the Chinese Government's policy in implementing a biodiesel program by mixing 5% with solar or B5. `We agreed to jointly encourage China to use B5 in order to reduce the trade deficit with Indonesia and Malaysia at the same time as being an environmentally friendly energy,` said Airlangga last week. (rzk) Source: economy.okezone.com ------------------------------------- Tuesday, August 29, 2017  JAKARTA – The palm oil industry still faces the challenge of an overabundance of other plant products which disrupts the price quite a lot. Based on data presented by the Indonesian Palm Oil Association (Gapki), the export volume of Indonesian palm oil (CPO and PKO (palm kernel oil) and its derivatives, including oleochemicals and biodiesel, reached 16.6 million tons. This performance increased by 25 percent if compared to the same period last year which only reached 12.5 million tons. Meanwhile, Indonesian palm oil production in the first half of 2017 has reached 18.15 million tons. This number shows a growth of 18.6 percent compared to last year's production in the same period which was 15.30 million tons. Production in the first half of 2017 was still influenced by last year's El Nino (an increase in ocean surface temperature that caused weather anomaly) so it was not optimal. Throughout the first half of 2017, the CPO price moved in the range of USD 650–USD 827.50 per metric ton. The price in January was quite promising with an average of USD 805.7 per metric ton. `From this, the impact of the economic downturn can be seen. The price continued to decline along with the sluggish global economy which resulted in sluggish demand and an overabundance of other plant oil production which caused the price to become cheaper,'' said Gapki Executive Director Fadhil Hasan. Last weekend, the Indonesian government stated that it will synergize with Malaysia to fill the CPO supply to China. `We agreed to jointly encourage China to use B5 in order to reduce the trade deficit with Indonesia and Malaysia at the same time as being an environmentally friendly energy,'' explained the Minister of Industry Airlangga Hartarto who previously met with the Malaysian Minister of Plantation and Commodity Industries Datuk Seri Mah Siew Keong. The export plan received a positive response from Gapki. `China's potential is still very large. It's an opportunity for us. The largest markets for Indonesian CPO are India, the European Union, China, and Pakistan,'' said Gapki spokesman Tofan Mahdi with conviction. During the first half of 2017, Indonesia's palm oil export performance to primary destination countries also grew positively, except for Pakistan. Exports in the first half to Pakistan decreased by five percent compared to the same period last year or from 1.1 million tons in the first half of 2016 down to 1.05 million tons in the same period this year. The Middle Eastern countries also experienced a decline, recording 12 percent. `The sluggishness of the global palm oil market is influenced by the overabundance of other plant oil production such as soybeans and rapeseed,'' added Tofan. The overabundance of production caused the price of soybeans and rapeseed to fall so palm oil which is not the main vegetable oil in Europe, the Americas, and China is ranked even lower. On the other side, Indonesian palm oil production in June is still stagnant and tends to slightly decline. Production in June was only able to reach 3.327 million tons or around three thousand tons compared to production last May which reached 3.33 million tons. Source: www.jpnn.com

Demo held in Jakarta, Sugarcane Farmers Ask for Sugar Price of IDR 11,000/kg

28

Aug

Demo held in Jakarta, Sugarcane Farmers Ask for Sugar Price of IDR 11,000/kg

The CEO of the Indonesian People's Sugarcane Farmers Association (APTRI), Soemitro Samadikoen, revealed that the price of sugar in the auction is [...]

Demo held in Jakarta, Sugarcane Farmers Ask for Sugar Price of IDR 11,000/kg. The CEO of the Indonesian People's Sugarcane Farmers Association (APTRI), Soemitro Samadikoen, revealed that the price of sugar in the auction is currently set at Rp 9,700/kg. According to him, that price is far from the basic production cost for farmers, which is around Rp 10,600/kg.   `We want the purchase price of sugar from farmers to not be Rp 9,700/kg, because we'll lose money at that price, it's below the production cost of Rp 10,600/kg. Ideally, farmers won't lose money at prices of Rp 11,000/kg. The government can sell according to the maximum retail price (HET) of Rp 12,500, which would give us a margin of Rp 1,500/kg,` Soemitro said when met at Monas on Monday (8/28/2017).   He went on to say that even if the price of sugar increased to Rp 14,000/kg, consumers would not be too affected. Since the consumption of sugar is not as high as other basic food products, the per capita consumption is relatively low. But according to him, improved sugar prices would greatly help the farmers.    `Let's say a family of 5, which would use up around 4 kg of sugar in a month. If the price of sugar increased by Rp 2,000/kg, a family would only have to pay an extra Rp 8,000 per month. That's an insignificant expense over the course of a month compared to the cost of parking. And it would really help the farmers. Two years ago, the price of sugar was Rp 18,000/kg and no one complained, because it was still reasonable. But everyone complains when the price of chili peppers increases,` he said.   According to him, the farmers' sugar is not selling because of the low price. On the other hand, imported refined sugar continues to trickle into the market, which is further depressing sugar prices.   `Our sugar still isn't selling. That's sugar that came out of sugar factories in June, and it still hasn't sold two months later because the highest bid we've gotten is only Rp 9,700/kg. There's a ton of refined sugar in the market, and if that's allowed to continue, sugarcane farmers will be reluctant to plant anymore, and in the long run we'll become even more dependent on imports,` Soemitro said.   He said that the demonstration was carried out by thousands of farmers who had grown tired of the current conditions. Coming in by bus, the sugarcane farmers were from various regions in East Java, West Java, and Central Java.   Source: Finance.detik.com

27

Aug

RI Protests US Biodiesel Levies

Trade Minister Enggartiasto Lukita stated that his party will first study the allegations from the US. In addition, the party will also speak with [...]

RI Protests US Biodiesel Levies. Trade Minister Enggartiasto Lukita stated that his party will first study the allegations from the US. In addition, the party will also speak with business operators, especially in the domestic palm oil sector, to get feedback. “We will definitely immediately file an objection and will further discuss this with business operators,” he said in Jakarta yesterday. As reported by Antara, the US has imposed anti-subsidy import duties on biodiesel from Indonesia that will apply retroactively for the past 90 days. This move is a follow-up to a petition from the local biodiesel industry, which accused Indonesia of providing subsidies for the biodiesel industry. Some time ago, the National Biodiesel Board (NBB) Fair Trade Coalition, together with 15 other American biodiesel producers, filed a petition regarding biodiesel products from Indonesia and Argentina. The petition was filed as a result of investigations conducted over the 2014-2016 period. The demands of the petition are accusations that Indonesia and Argentina have provided biodiesel subsidies and dumped prices for biodiesel sold in the US, and that they are asking the US government to initiate anti-dumping and anti-subsidization actions. It is noted that the temporary anti-subsidy import duty for biodiesel for Wilmar International Ltd is 47.06%, PT Musim Mas has reached 68.28%, and for other companies that export to the US, it is 44.92%. The temporary anti-subsidy import duty on biodiesel will also apply to companies from Argentina, with LDC Argentina SA at 50.29%, Vicentil SAIC at 64.17%, and others at 57.01%. The United States Department of Commerce will issue a final decision on November 7, 2017, and the decision could be extended and the amount of the anti-subsidy import duty may change back. For the record, the US imported US$1.2 billion worth of biodiesel from Argentina and US$268 million worth of biodiesel from Indonesia in 2016. The import trend for biodiesel for the US grew by about 58% over the 2014-2016 period. (tl) Source: Investor Daily —————————————————–     Thursday, August 24, 2017 INDONESIAN EXPORTS: US Imposes Additional Import Duties on Biodiesel JAKARTA — The United States has imposed countervailing duties or additional import duties on biodiesel commodities from Indonesia. The United Department of Commerce (USDOC) decided to impose additional import duties on Wilmar International Ltd of 41.06% and PT Musim Mas of 68.28%. In the meantime, other Indonesian producers will be subject to additional import duties of 44.92%. Minister of Trade Enggartiasto Lukita stated that he will file an objection against the US authorities’ decision. His party will discuss it further with the relevant stakeholders. However, the Minister of Trade has not yet decided whether he will bring this matter to the World Trade Organization (WTO). “Yes, this has only just happened and we will look into it and will study it immediately so that immediate action can be taken,” he said at the Ministry of Trade office on Wednesday (23/8). Meanwhile, Senior Manager of PT Musim Mas Togas Sitanggang was unwilling to give any comment regarding the imposition of additional import duties from the US. “No comment,” he said in answer to a question from Bisnis. The imposition of additional import duties started when the National Biodiesel Board (NBB) Fair Trade Coalition and 15 other US biodiesel producers filed a petition regarding products from Indonesia and Argentina on March 23, 2017. The petition contained two main points and claimed to be the result of an investigation conducted over the period 2014-2016. Firstly, that Indonesia and Argentina have provided biodiesel subsidies and dumped prices for biodiesel sold in the US. Secondly, that the US government should initiate anti-dumping and anti-subsidization action by conducting an investigation. The NBB claims that the market share for Indonesian biodiesel in the US is 5.1%, while the market share for Argentina is 20.3%. The items considered to be government subsidies include the Biodiesel Levy from the Indonesian Palm Oil Fund Management Agency (BPDP-KS) and export facility subsidies. In its petition, the NBB also stated that over 2014-2016 consumption had increased by 800 million gallons or by 58%. The high level of imports is considered to have had a negative impact on domestic US producers and hampered growth. The Director of Trade Security, Ministry of Trade, Pradnyawati, previously stated that diplomatic steps had been taken with regard to the allegations that had been made. The party had also asked the Ministry of Foreign Affairs to deal with the issue as one of the most important parts of diplomacy. He stated that the accusations of biodiesel dumping were a serious matter of concern for the government, since the sector is a mainstay of exports for Indonesia. “We [the Ministry of Trade] have also prepared a refutation of several points regarding what Indonesia is accused of,” he explained. As is known, Indonesian biodiesel exports in 2015 and 2016 amounted to 206,000 tons and 373,500 tons, respectively. Around 90% of Indonesian biodiesel products are sent to the US. Based on Trademap data, biodiesel exports to the US in 2015 amounted to US$153.03 million. This figure rose to US$185.31 million the following year and rose again to US$291.91 million in 2016. (M. Nurhadi Pratomo) Source: Bisnis Indonesia

KTM Sugar Factory Begins First Sugarcane Crushing of the Year

13

Jul

KTM Sugar Factory Begins First Sugarcane Crushing of the Year

An achievement which is welcomed by the company, because it has a strong desire to reduce its dependency on imported sugar. By starting to mill sugar [...]

KTM Sugar Factory Begins First Sugarcane Crushing of the Year. An achievement which is welcomed by the company, because it has a strong desire to reduce its dependency on imported sugar. By starting to mill sugar cane this year, the KTM sugar factory hopes that it can make its own contribution to the nation and state.
“The KTM Sugar Factory only did its first sugar cane milling in 2017, previously it was still carrying out tests. The KTM Sugar Factory has a capacity of 12,000 tcd (tons of cane per day),” said the Director of Operations of the KTM Sugar Factory, Agus Susanto, on Wednesday (12/7/2017).
“We very much welcome the hopes of Regent Fadeli to increase sugar cane production to 100 tons per hectare, and we will help the sugar cane farmers in the Lamongan Regency,” he continued.
Agus then explained that, up until now, the KTM Sugar Factory has been receiving sugar cane not only from Lamongan, but also from several surrounding cities. Starting from the Tuban region to Bojonegoro, although he admitted that it prioritizes local sugar cane farmers from the Lamongan Regency.
According to the data released by the Lamongan Regency Government, in 2016 the sugar cane harvest in the Lamongan Regency reached 4,952 hectares, with total production reaching 308,145 tons with a rendement still in the range of 6.5 percent. Meanwhile, the number of sugar cane farmers in Lamongan, was recorded as being 7,428 people.
On a previous occasion, Lamongan Regent Fadeli who attended the People's Sugar Cane Harvest Partnership Milling Season of the Kebun Tebu Mas Sugar Factory in the Sumbersari Village, Sambeng District, Lamongan, on the same day declared that he hoped that sugar cane production which up until now had only reached an average of 62.2 tons per hectare could be increased to 100 tons per hectare.
“We must not only be satisfied with sugar cane production of 62.2 tons per hectare. I hope that the Kebun Tebu Mas Sugar Factory will provide for the sugar cane farmers so that they can increase their sugar cane production to reach 100 tons per hectare. One of the ways that the production can be increased is by using a superior breed of seedling,” said Fadeli.
After attending the harvest with the local Forkopimda, Fadeli and his entourage took the opportunity to directly examine the scales, core sampling, and sugar cane crusher (tipper).
“With the presence of the KTM Sugar Factory, with its multiplier effect, I hope that the prosperity of the people can be increased, especially that of the sugar cane farmers in the Lamongan Regency,` Fadeli hoped.
`The use of workers from Lamongan, the many stores that have started to open close to the factory, the houses that are being used as boarding houses for KTM employees, and the increasing price of land around the factory. I hope that the benefits that are provided do not stop there, whether on the scale of Lamongan or nationally.”
The sugar factory KTM produces 30 percent raw sugar of its total volume, 40 percent white crystal sugar, and the rest in the form of refined crystal sugar for pharmaceuticals. The 350 million US dollar investment, most of which is used to buy land and machinery.

Author Contributor Gresik, Hamzah Arfah
Editor Aprillia Ika

CPO PRICE ON JULY 6: Rebounding for Four Days in a Row

06

Jul

CPO PRICE ON JULY 6: Rebounding for Four Days in a Row

September 2017 CPO futures, the most active contract on Bursa Malaysia, gained 0.67 percent, or 17 points, to RM2,555 per ton as at 11.29am. Earlier [...]

CPO PRICE ON JULY 6: Rebounding for Four Days in a Row. September 2017 CPO futures, the most active contract on Bursa Malaysia, gained 0.67 percent, or 17 points, to RM2,555 per ton as at 11.29am.
Earlier today, the CPO price opened marginally higher by 0.08 percent, or two points, at RM2,540, after a sharp increase of 1.10 percent, or 30 points, to RM2,538 yesterday.
The CPO September contract extended its rally for the fourth day after it ended 1.79 percent, or 44 points, higher at RM2,503 on July 3.
“The market is factoring in the possibility that production in Malaysia could be weaker in June,” Paramalingam Supramaniam, director of broker Pelindung Bestari was quoted as saying by Bloomberg.
A Bloomberg survey estimates Malaysia’s palm oil output to decline by 0.6 percent month-on-month in June. Meanwhile, research house CIMB said Malaysia’s palm oil stocks remained flat at 1.55 million tonnes in June.
There is also expectation that the softer ringgit could boost demand.
The ringgit was quoted at 4.2985 against the US dollar as at 11.44am, down 0.01 percent from yesterday’s close of 4.2980.
 
Movement of September 2017 CPO Contract

Date

Level

Change

July 6, 2017
(11.29am)

2,555

+0.67%

July 5, 2017

2,538

+1.20%

July 4, 2017

2,508

+0.20%

July 3, 2017

2,503

+1.79%

June 30, 2017

2,459

-0.41%

Source: Bloomberg

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