Cheap CPO, Some Mills in Malaysia Temporarily not Operate

Cheap CPO, Some Mills in Malaysia Temporarily not Operate

Palmoilmagazine, Arie Basuki, Sawitfest 2021

Pamoilmagazine, KUALA LUMPUR - Crude palm oil (CPO) price in Malaysia drastically gets cheaper which it hit the highest numbers at RM 6.632 (US$ 1.506,25) per ton. But it decreases up to 22% to be RM 4.922 (US$ 1.117,42) on Monday (27/6/2022). This is a loss in this year.

Many mills in Malaysia purchased fresh fruit bunch (FFB) based on the monthly CPO price at about RM 6.200 (US$1.408,13) per ton – but selling the production should base on the daily price.

“No mill could afford buy FFB with the numbers,” President of Palm Oil Mills Association (POMA), Steven Yow said, as quoted from Reuters.

CPO at Bursa Malaysia Derivative Exchange got better because of the vegetable oil pressure in the globe, the lack of workers, the conflict in Russia – Ukraine, and the export ban in Indonesia some time ago.

But CPO price contract got cheaper after Indonesia revoked CPO export ban and tries to escalate the exports. These triggered CPO price fluctuation in vegetable oil markets.

As quoted from channelnewsasia, nowadays CPO price, the mills in Malaysia where the country is lack of plantation workers, expensive input to spend would lost potential profits about RM 150.000 (US$ 34.067,68) for 100 tons of CPO which was produced because it gets cheaper up to RM 4.700 per ton.

Yow mentioned, the mills which delivered CPO production based on the contract now stop purchasing or getting FFB from the suppliers until FFB gets normal price again. “The temporary stoppage could be one week and this situation never happened in the past 35 years,” he said. (T2)


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