• Bloomberg reported that the Thai government has plans to buy 200,000 tonnes of palm oil to support local prices. The Electricity Generating Authority of Thailand (EGAT) is expected to buy 100,000 tonnes of palm oil in May and will buy as much as 200,000 tonnes, if needed. EGAT has bought 160,000 tonnes of CPO since last year for power generation.

• Bloomberg cited the Indonesian Biofuels Producers Association as saying that Indonesia has exported about 173,543 kiloliters (151,170 tonnes) of biodiesel mainly to the European Union and China in 1Q2019. An official said that the biodiesel exports were constrained by dumping and subsidy allegations in the US and EU. Indonesia’s biodiesel exports may drop to 1.2mil kiloliters (1.05mil tonnes) in 2019F if the EU imposes duties. The official added that road tests for B30 will be launched in Indonesia soon.

• Bloomberg quoted Russian daily Kommersant as saying that Russia’s Federal Customs Service has proposed increasing import duties on some food and drinks ingredients. Companies such as PepsiCo and Nestle have criticised the proposal. Import duties on palm oil, orange juice concentrate and coconut oil may be raised. The proposal has been sent to the Agriculture Ministry, where it is being studied.

• NST reported that FGV Holdings may be closing down two non-core businesses and retrenching 135 staff by year-end. FGV is shutting down Felda Engineering Services and Felda Properties after failing to find buyers. Discussions were held with Felda and Koperasi Permodalan Felda to take over the businesses but no agreement was reached.

• Reuters cited a Liberian lawyer, who has won the Goldman Environmental Prize, as saying that oil palm plantations in Liberia are billed as bringing jobs and development but actually, they leave locals poorer. Alfred Brownell said that sometimes palm oil companies offer jobs but not enough for the number of people who lost their land. Another environmentalist helped community members filed a complaint in 2012, alleging environmental damage and human rights violation by Golden Veroleum Liberia. The latter has 543,600ha of land leased for oil palm cultivation. An industry body responded by halting the company’s oil palm activities on most of the land. The decision was upheld last year after a legal battle.

• Reuters reported that there is a new online shopping tool in Singapore, which will give consumers the option of buying products made using ethical palm oil. Launched by the People’s Movement to Stop Haze and advertising agency, Havas Group, EcoCart is a Google Chrome plug-in that allows online shoppers to identify items that use sustainably produced palm oil. The tool has a target of getting Singaporeans to make 500,000 “switches” by the end of 2019.

Source: AmInvest Research - 13 May 2019