Malaysia’s Jan palm oil stocks fall to five-month low

KUALA LUMPUR: Malaysia’s January palm oil stocks slipped to a five-month low as a decline in production outpaced a drop in exports, industry regulator Malaysian Palm Oil Board said on Friday.

Stocks in the world’s No 2 producer of the edible oil fell 2.5 per cent to 2.0 million tons from December last year, almost matching market expectations of a 2.2 per cent drop.

The still-high inventories can potentially shore up global edible oil supply in the wake of erratic weather affecting soy crops in South America.

Benchmark palm oil futures on the Bursa Malaysia Derivatives Exchange may come under some pressure after losing 0.8 per cent at midday ahead of the data release.

“Stocks are still around 2 million tons which is enough for one-and-a-half months of exports,” said a trader with a foreign commodities brokerage.

January production dropped 13.9 per cent to 1.29 million tons from a month ago on seasonally weaker yields after strong output last year with reports of some heavy rain affecting harvesting.

Planters and traders expect Malaysian output in February to decline further on weaker yields although it may not be a double-digit percentage fall as the weather has improved and there are fewer public holidays this month.

Malaysia’s January exports also dropped 13.2 per cent to 1.38 million tons as the government had not issued a tax free export quota for crude palm oil at the time and overseas buyers preferred Indonesian cargoes offered at a discount.

Traders are counting on China, a key customer of Malaysian palm oil, to start restocking in a big way after the Lunar New Year holidays in late January, and for more crude palm oil exports after the duty free quotas.

Malaysian imports of Indonesian crude palm oil rose 32.1 per cent to 167,487 tons, MPOB said.

Read more »

Posted in: BUSINESS

Gilani, Shaikh meet to discuss economy

ISLAMABAD: Prime Minister Yuosuf Raza Gilani on Thursday held a meeting with Advisor on Finance Abdul Hafeez Shaikh to discuss economic situation and matters related to the next budget.

Shaikh called on the premier here at the PM House and briefed him about the state of national economy.

During the meeting, he briefed Gilani on continuing progress in key areas such as domestic tax collection that has registered 26 per cent increase during the first half of the current financial year compared to the corresponding period of the previous financial year.

Gilani directed the advisor to further consolidate the stabilisation of growth of the economy with a view to leading the job creation for the youth.

The prime minister also gave guidelines regarding the provision of relief to the people in the next budget.

Read more »

Posted in: BUSINESS

Power shutdown spoils Sundar production plans

LAHORE: The hopes to start full-fledged production at Sundar Industrial Estate in view of the resumption of gas supply after one-and-a-half months dashed on Wednesday because of power breakdown which the industrialists said was sudden and devastating.

The outage continued from 8am to 6pm – the timings during which the industrialists had planned to run their factories at full production capacity to cover up the losses they had been suffering since the suspension of gas supply to the industrial estate on Dec 22.

They industrialists strongly protested against the shutdown and convened a meeting of their board of management on Thursday (today) to decide how to counter it.

“We had planned to resume full-fledge production after so many days, and had called staff for the purpose in the morning. But power shutdown did not allow us to utilise the gas which has been given to us three days a week after the suspension of its supply on Dec 22,” said the estate’s board of management president Ahsan Butt.

No official concerned of Lesco was available for comment despite several attempts.

The multi-billion rupees industrial estate has 162 operational units employing over 100,000 workers. Its total capacity is 606 units, 200 of them are under construction.

According to Mr Butt and some other industrialists, they had bound their workers to reach the factories early in the morning to start production at 8am so as to fully utilise the gas supply available only for three days a week.

But, the factory owners and workers kept waiting for the resumption of the power supply till in the evening but in vain. They returned home in dismay and anger accusing the government of deliberately destroying industrial sector.

Mr Butt said the shutdown was sudden and imposed without consulting the board of management. The chief engineer of the industrial estate was informed about the shutdown only on Tuesday night, leaving no time for preparation of an alternate production plan.

And when the Lesco authorities were asked why they did not timely consulted the board so that production was not affected, they promised to send their officials for the purpose on Thursday.

Butt said contacts with Lesco authorities concerned on Wednesday brought more sad news as they explained that the shutdown was for five days and the board would be consulted for shutdowns that would follow.

“This is clearly an attempt to totally destroy industry. We fear power shutdown till Feb 25 which means loss of billions of rupees. The loss during this five-day shutdown alone is several million US dollars,” he said.

Read more »

Posted in: BUSINESS

Stocks close at 6-1/2 month high

KARACHI: A rally in Pakistani banking shares helped lift the bourse to end on a six-and-a-half month high on Tuesday as foreign investors snapped up local stocks on the back of expected strong corporate results, dealers said.

The Karachi Stock Exchange (KSE) benchmark 100-share index gained more than one per cent for a second straight day, closing up 1.22 per cent or 147.70 points, at 12,284.62 points, its highest close since July 26, 2011.

Volume fell to 162.11 million shares, compared with 196.3 million traded on Monday.

“The bullish trend continued on renewed foreign investment led by banking stocks in the earnings announcement session at KSE,” said Ahsan Mehanti, director at Arif Habib Corp Ltd.

Foreign investors bought shares worth a net $3.47 million on Monday. Data for Tuesday will be released later in the day.

Winners on the KSE included Bank Alfalah, which closed 2 per cent higher at 12.75 rupees, and National Bank of Pakistan, which rose 2.85 per cent to 46.58 rupees.

Read more »

Posted in: BUSINESS

Islamabad committed to expand economic relations with Tehran

ISLAMABAD: Pakistan is committed to develop relations with Iran in various fields and in particular in field of economy.

This was stated by Advisor to the Prime Minister on finance Abdul Hafeez Shaikh in an interview with Islamic Republic NewsAgency here Monday.

The official said that there is enormous potential to enhance trade ties between Iran and Pakistan.

Abdul Hafeez Sheikh said that Iran and Pakistan are united by the bond of history, faith and culture. He said that officials of Iran and Pakistan had spent a productive day to bring the bilateral ties closer.

The advisor urged the businessmen of the two countries to work together to enhance cooperation in trade sector.

Read more »

Posted in: BUSINESS

Urea prices fall

ISLAMABAD: Urea prices have decreased by Rs400 per 50-kg bag due to timely import and distribution of the product, an official of ministry of industries told APP on Monday.

He said the prices eased to Rs1,800 from Rs2,200 in the local market. The prices are likely to ease further after arrival of 500,000 tons of urea in coming days, he added.

He informed that as many as 700,000 tons of urea fertiliser had already been offloaded and distributed across the country to meet requirements of farmers in Rabi season.

Timely import and check on hoarding and black marketing will help maintain sufficient quantity of the fertilisers for Kharif sowing, he remarked.

He said that some local urea manufacturing units were not operating at their optimum level due to gas load management programme which resulted in demand-supply gap and price hike of the commodity in the local market. The imported urea was costing the country about Rs2,600 per 50 kg bag and the government was providing Rs1,300 subsidy per bag to provide relief to the growers to increase crop output, he added.—APP

Read more »

Posted in: BUSINESS

Government approves sugar exports for first time since 2009

ISLAMABAD/DUBAI: Pakistan has approved the export of sugar for the first time in nearly three years, spurred by an expected surplus of more than 1 million tonnes, but the move is unlikely to affect the global market, which has priced in rising output in other countries.

Pakistan was forced to import about 1.2 million tonnes of sugar in 2010 after production fell to 3.1 million tonnes from the 2009/10 crop year, when many farmers switched to more profitable crops.

“The government has approved the export of 100,000 tonnes of sugar, but the modalities of export have not been worked out yet,” Khizer Hayat, a spokesman of the state-run Trading Corporation of Pakistan, told Reuters, referring to white sugar.

“We are waiting to see if it will be done through private channels or by government corporations.”

Last year, Pakistani millers sought permission from the government to export up to 500,000 tonnes of refined sugar because of expectations of a bumper crop, which could exceed 5 million tonnes.

“We expect the sugar surplus to be 1.5 million tonnes, given the current domestic consumption,” a Ministry of Commerce official, who wished to remained anonymous, told Reuters.

Trade sources, speaking to Reuters on the sidelines of the Kingsman sugar conference in Dubai, said Pakistan may decide to allow a further 300,000 to 500,000 tonnes of exports later, while most of the 100,000 tonnes of whites would be shipped to Afghanistan.

“It has come as a surprise that Pakistan has so much sugar,” Jonathan Kingsman, Managing Director of consultancy Kingsman SA, told Reuters.

“They (Pakistanis) will be willing to chase sugar prices lower to be able to place that sugar into the export market. If their production is as good as it seems to be, they could export 500,000 tonnes.”

Trade sources at the Kingsman conference estimated that Pakistan’s 2011/12 sugar production was between 4.5 million and 5.1 million tonnes, while annual domestic sugar consumption was seen at 4.2 million tonnes.

But analysts said global sugar prices were expected to be steady at current levels as the market factored in more supply from India, Brazil and Thailand.

India, the world’s number 2 sugar producer after Brazil, has a sugar surplus of 3 million to 4 million tonnes available for export in 2011/12.

India, which had allowed 1.5 million tonnes of exports under a scheme called Open General Licence (OGL) in the 2010/11 crop year ending September, recently issued a formal order for unrestricted exports of 1 million tonnes.

“I think short-term, basically I am looking at sugar to be trading in a range. I mean, for the short term, prices could be pressured because of the (global) surplus, but longer-term, I think, prices should be quite stable,” said Lynette Tan, an analyst with Phillip Futures in Singapore.

“Sugar is a very important commodity. You can see some of the governments probably even going into stockpiling programmes.”

March raw sugar futures on ICE rose 0.46 cent to end at 23.94 cents per lb on Friday after Labor Department data showed the US economy created jobs at the fastest pace in nine months in January, far outstripping analysts’ expectations.

Read more »

Posted in: BUSINESS