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Malaysia to reduce palm oil export tax, biodiesel mandate

The Plantation Industries and Commodities Ministry (MPIC) and the Finance Ministry are currently in talks to reduce Malaysia’s palm oil export tax from 8% to between 4% and 6%.

The two ministries are also aiming to reduce the country’s biodiesel mandate to meet the global edible oil shortage.

According to MPIC Minister Datuk Zuraida Kamaruddin, a decision is pending and Malaysians are expected to be the top in global palm oil exports.

However, she urged industry players to focus on market variables that are likely to cause price volatility which are the export policy of Indonesia, the recovery of palm oil production in Malaysia, the adjustment of biodiesel policies in various countries, progress of the Russia-Ukraine conflict and the weather in both the US and South America.

“The fact that palm oil stockpile increased for the first time since October 2021 by 11.5% month-on-month to 1.64 million tonnes in April 2022 driven by higher output (+3.6% to 1.46 million tonnes) and weaker exports (-17.7% to 1.06 million tonnes) should not be a cause for concern. 

“This is because palm oil stockpile will likely dip in May 2022 on the back of seasonally lower crude palm oil (CPO) production (arising from the Ramadhan month) and stronger exports (following Indonesia’s recent move to widen its export ban on raw materials for cooking oil),” the minister said in a statement today.

With the announcement of Indonesia’s decision to ban palm oil exports from April 28, CPO prices have soared above RM7,000 per tonne mark to RM7,516 per tonne.

However, Indonesia decided to lift its palm oil export ban from May 23 (Monday) after its domestic cooking oil supply situation has improved but decided to only lift it when bulk cooking oil price comes down to 14,000 rupiah (RM4.20) per litre across Indonesia.

Since the ban has seriously damaged Indonesia’s economy, Zuraida assured that the government has rescinded the decision to ban its palm oil exports. 

“Meanwhile, exports were dragged by lower exports to China (50.8%), European Union (23.2%) and Pakistan (90.3%) due to several factors including strict Covid-19 lockdowns which hampered palm oil shipments to China and demand destruction as a result of high prices. 

“Nevertheless, preliminary data from AmSpec Agriculture Malaysia indicated that palm oil shipments alone have surged by 40.32% during the first ten days of May on account of Indonesia’s absence from the global export market, a weak ringgit and widening palm discounts to bean oil.

“The ministry expects global edible oil demand is not as weak as we think, although the April process may be lower compared to the previous month but still remain at unprecedented levels,” she added.

On a year-to-date, CPO prices have risen above expectations to RM6,300 per tonne from RM4,300 per tonne which was projected by market analysts for 2022. 

Zuraida forecasted that CPO prices are likely to consolidate due to the ending uptrend in monthly fresh fruit bunches production rather than poor demand, but would stay elevated from the tight supply, robust market, uptake from China and the oil price hike arising from the Ukraine-Russia conflict.

“The ministry will continue to ensure the palm oil industry, which is the country’s main commodity, continues to contribute to national economic growth, thus benefiting all, especially smallholders and industry players,” she said.

Philippines in talks with Russia, Southeast Asia countries for supply of fertilizer

MANILA, Philippines — The Philippines is in talks with Russia and three countries in Southeast Asia for the procurement of fertilizers in a bid to address supply and price issues.

“We had meetings with Russia. They have already responded,” Fertilizer and Pesticide Authority (FPA) deputy executive director Myer Mula said in a virtual presser yesterday.

Mula said Russia has expressed willingness to supply the country with fertilizer, particularly urea.
He said the Philippines has yet to provide the volume of fertilizer it needs.

Mula said discussions with Indonesia, Malaysia and Thailand are also ongoing.

However, he said there is no assurance from these countries as they have their own requirements to meet.

“But we continuously coordinate with other countries,” he said.

Last month, Agriculture Secretary William Dar said the Philippines and the People’s Republic of China were in the middle of bilateral negotiations for the procurement of fertilizers, including biofertilizers and bio stimulants.

“We have been talking with Ambassador Huang Xilian on the country’s ongoing request to buy fertilizers from China, and we are optimistic about the positive result of our discussions regarding the potential trade,” Dar said.

Fertilizer prices in the international market have been rising since last year mainly due to larger demand, as well as higher freight cost.

Latest data from the Fertilizer and Pesticide Authority showed that the average retail price of prilled urea reached P2,982.97 per 50-kilo bag from May 9 to 13. This is more than double the P1,156.64 per 50-kilo bag price in the same period last year.

Other measures being taken by the government to address the rising fertilizer prices include the provision of fertilizer subsidies, as well as the promotion of the balanced fertilization strategy, which refers to the combined application of organic and inorganic fertilizers based on crop and soil nutrient content.

Dar earlier cited ethe need for more fertilizer subsidies to prevent a decline in palay production.

“If we’re not able to subsidize more, the rice farmers today will see a decline of about 1.1 million metric tons (MT) of palay this year,” Dar said.

An additional P6 billion fertilizer subsidy budget for the wet planting season was earlier approved by President Duterte as part of the Plant Plant Plant 2.

“Finance Secretary Carlos Dominguez is now looking at the funding source as he supports this additional budget for fertilizer subsidy. He promised to have it very soon,” Dar said last week.

To cushion the impact of the global challenges on the country’s food security, the DA earlier implemented Plant Plant Plant with a P24 billion budget, of which P20 billion has been allocated for fertilizers.

Investment flow drives Vietnam's industrial property

There would be huge investment capital inflows in Vietnam’s industrial property sector in the coming time if bottlenecks are solved to pave the way for multinational manufacturers, according to participants of the first session of the Industrial Property Forum 2022 co-organised by VIR and BW Industrial Development JSC.

According to Pao Jirakulpattana, vice president at Warburg Pincus Singapore, China is competing with many other emerging areas, including Vietnam.

“If you look at the investment flow on the global scale, although the flow is coming back to China in the global perspective as political tensions have arisen, ASEAN is becoming an attracting destination, including Vietnam,” Jirakulpattana said.

“Vietnam has done pretty well in receiving new investment flows. We highly appreciate the determination of the government to define which sectors should be the top priority. For example, the electronic and power sector will develop strongly in the next 10 to 15 years. Vietnam has started with intensive labour sectors. However, sustainable development must be more concentrated,” he added.

Jirakulpattana also expressed Vietnam’s disadvantages in capital and financial products. “We do not have an efficient approach for large-scale international investors yet, such as the Centre Group or chains from the Philippines,” he added.

Meanwhile, Bruno Jaspaert, general director at DEEP C Industrial Zones expressed that Vietnam should not directly compete with China, but must be different from China and attractive to investors.

“Vietnam has an effective economy but like many other countries, it has to improve its infrastructure system, to meet the increasing demand of the market,” Jaspaert said.

He expressed the trend is shifting from Taiwan and China where manufacturers are expanding their factories.

“Despite China remaining the biggest manufacturer base for a long time, Vietnam is at a very strong position,” he added.

Jaspaert expected that there would be a large investment movement if an expressway connecting China’s Shenzhen and Vietnam was built in the future.

Vietnam, moreover, needs to strengthen its competitiveness by improving policies and regulations, to be more supportive for investors and developers,” he said.

Bui Trang, general manager of Cushman & Wakefield Vietnam, also expressed that manufacturers from Singapore, the US, and the European community have been moving into the Vietnamese market.

“Real estate developers have been very well connected with banks and other financial solutions to raise capital for their businesses. However, they need to focus on long-term financial sources for sustainable development,” Trang said.

“Japan and South Korea are also very interested in the Vietnamese market. With many multinational trade agreements, billions of US dollars are waiting to come to Vietnam,” Trang said.

Regarding bottlenecks, skyrocketing land prices in some key areas led to higher costs for manufacturers. Meanwhile, although Vietnam has spent about 5.8 per cent of GDP on infrastructure development, it is still a long way from developing an integrated infrastructure network with a deep-sea port system, inter-regional highways, and waterways.

By Bich Ngoc

Source : Vietnam Investment Review

Jokowi Ratifies 1990 International Oil Pollution Convention

President Joko Widodo, known as Jokowi, on Thursday officially issued Presidential Regulation No.76/2022 which ratifies the 1990 international convention on oil pollution preparedness, response, and cooperation. The regulation has been effective since the day of the signing on April 28. 

The convention was adopted at the International Maritime Organization Conference held on November 30, 1990, in London, which aimed to tackle oil spills at sea and ensure the protection of the maritime environment.

This convention contains detailed rules overseeing a number of responses to oil pollution, such as emergency response plans, reporting procedures, national and regional response systems, to international cooperation.

In the past decade, there have been some instances of oil spill contaminations that had affected Indonesia, such as the Montara wellhead platform blowout experienced by the Petroleum Authority of Thailand Exploration and Production (PTTEP) Thailand. It was located in the Timor Sea, west of Australia, in August 2009, and was contaminated the southern coast of East Nusa Tenggara. 

Another incident took place on January 2, 2015, which saw an oil spill from the crash between two vessels; MT. Alyarmouk and MV. Sinar Kapuas. This happened in the Singaporean Strait and spread to Indonesian waters. 

The latest was the oil spill at the Pertamina Hulu Energi Offshore North West Java in July 2019. 

Source: Tempo.co

PH: Franchising sector sees robust growth

The domestic franchising sector sees growth accelerating this year with the influx of new breed of franchisees and the issuance of Executive Order 169 that seeks to protect micro small and medium enterprises (MSMEs) and promote entrepreneurship.

 

“As the economy opens up and more people return to invest in new opportunities, we see accelerated growth in franchising,” said Chris Lim, president of the Philippine Franchising Association (PFA).

The projected growth acceleration, he said, is driven by the realization of people of the need to diversify their income sources and a trend of people wanting to be their own boss and not have to go to an 8 to 5 job.

“We’ve also seen new breeds of franchisees coming in – from landlords who want to do more than just rent out their properties, to retrenched employees and business owners wanting to start over but not wanting to take on too much risk. They know franchising is a safer investment choice that’s why it has a 90 percent-plus success rate,” he said.

In addition, Lim said the issuance of EO 169 “Strengthening the Franchising Industry for the Protection of Micro, Small and Medium Enterprises” by President Rodrigo Duterte will further promote entrepreneurship.

 

“We, in PFA, have been ceaseless in our efforts to educate the public on wise franchise investment,” said PFA Chairman Sherill Quintana.

“Transparency in a franchisor’s business dealings is also a major feature of the Fair Franchising Standards (FFS), which is PFA’s code of ethics,” Lim added. The FFS serves as a guide to all PFA members – 70 percent of which are MSMEs – in how they conduct the sale of their business.

The essence of the EO is to protect franchisees and eliminate franchise scams,” said Quintana. The PFA, she said, will participate in the crafting of the EO’s IRR. “It will be critical to create practical IRR to ensure that it does not stifle the growth and innovation of the sector as was the experience of other countries that over-regulated their franchising sectors,” she said.

Both officials vowed to continue working with the national government as the implementing rules and regulation of the EO is being developed in order to continue advocating for the interests of MSMEs and ensure the growth of the franchise sector, which provides businesses opportunities and jobs for over two million Filipinos.

For her part, Philippine Chamber of Commerce and Industry Chairman Bing Limjoco said the EO will definitely strengthen franchising in the country. “MSMEs are now protected under the law against unscrupulous fly-by-night franchisors who took advantage of the franchising’s popularity for their self-gain,” said Limjoco, who is also vice-chairman of Francorp Philippines.

PFA also expressed gratitude to Secretary Ramon Lopez, Undersecretary Ruth Castillo and Assistant Secretary Ann Claire Cabochan for inviting PFA to be part of the process which drafted the said EO.

Under the EO, the DTI was tasked to create an MSME Registry of Franchise Agreements.

Source: Manila Bulletin

Bangladesh eyes more agriculture agreements with Philippines

MANILA, Philippines — Bangladesh has expressed interest to strengthen its partnership with the Philippines as it plans to forge more agricultural agreements.

In a statement, Bangladesh Ministry of Agriculture Secretary Mohammad Sayedul Islam said he was looking forward to forging more agreements with the Philippines in other areas, particularly in pineapple and banana.

Over the weekend, the Philippines and Bangladesh strengthened their ties in agriculture technology development with the signing of an agreement between the Bangladesh Agricultural Development Corp. (BADC) and SL Agritech Corp. (SLAC)  for the production of SL-8H F1 hybrid rice seeds.

Under the MOA, SLAC will guarantee a timely supply of good genetically pure parental lines to be used for F1 seed production in Bangladesh, while BADC will provide production area, inputs, and facilities.

BADC will also be responsible for labor and administrative expenses, as well as production and postharvest activities.

SLAC is the biggest hybrid rice seed company in the Philippines.

The agreement was signed by SLAC chairman Henry Lim Bon Liong and BADC chairman AFM Hayatullah.

SLAC and BADC previously had a 16-year technical collaboration for the production of seeds, which started in 2005.

Lim expressed gratitude to its Bangladeshi counterparts for its full trust and confidence in the Philippine seed production company.

“It is rewarding that our collective efforts, especially in rice production will alleviate fear caused by the looming food crisis,” Lim said.

For his part, Dar lauded the Bangladesh government for having the political will to pursue programs and initiatives to attain food security.

“For years, they have allotted a significant budget for the food production sector, and have invested so much to ensure that their citizens will have enough food supply. We have to learn lessons from Bangladesh,” Dar said.

The renewed partnership under the MOA comes at an opportune time as the world faces a possible food crisis due to the ongoing pandemic and dispute between Ukraine and Russia.


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THAI and Siam Piwat synergizes, connecting the world of travel with business ecosystem over-the-top privileges

Thai Airways International Public Company Limited (THAI) and Siam Piwat Company Limited joined the global premium business ecosystem by introducing THAI products and services on ONESIAM SuperApp and in Siam Piwat department stores, Luxury Lifestyle Destinations which would connect the customer journey to fulfill THAI and Siam Piwat customers’ lifestyle. Furthermore, customers will receive privileges all year round.

Kittiphong Sansomboon, THAI Director of Customer & Marketing Department said “The collaboration between THAI and Siam Piwat will offer our ROP members with privileged experiences through creative innovations. The special services and marketing promotion under this campaign are a part of THAI ROP Exclusive Offers project that focuses on partnership with business alliances to enhance air travel experiences at every contact point of our customers’ journey. In addition to this campaign, ROP members shall earn further privileges in upcoming offers under the project.”

Panthep Nilasinthop, Chief Customer Officer of Siam Piwat, said “Siam Piwat focuses on strengthening our world class and premium business ecosystem. We create and deliver new experiences both in the actual and the virtual world. Our goal is to be customers’ top-of-mind for local and international shoppers. Over a period of time, we have successfully built a strong partnership network that incorporates leading business alliances in Thailand and internationally, as part of our ‘Collaboration to Win’ strategy. The synergy spans over businesses in more than 13 industries that together join force to further strengthen this successful ecosystem that present limitless opportunities.

As a ‘Luxury Lifestyle Destination,’ every ONESIAM platform and retail premises will offer our target shoppers the right products and services that caters to their needs. Based on our collected data of consumer behaviors, especially on the close look on their lifestyle, we have found that our customers are keen travelers and always have a trip or more planned. The collaboration between Siam Piwat and THAI is formed to bring the best of both business leaders to customers. In addition, the collaboration syncs both companies’ customer databases which allows an even better customer journey that shoppers can experience anytime, anywhere at ONESIAM SuperApp.

Content features photos and stories of tourism attractions around the world stimulating travel demands and enhancing personal experiences.

Royal Orchid Plus (ROP) offers special privileges through ONESIAM SuperApp for members who receive ONESIAM membership status together with 150 VIZ Coins (10,000 entitlements) to use for online shopping and at shops in the department store (terms and conditions apply).  Many more discounts from branded stores will be offered throughout the year.

THAI Shop will provide a variety of THAI products through ONESIAM SuperApp where customers may conveniently surf and go online shopping.

In addition, customers will find it even more convenient to purchase air tickets online via ONESIAM SuperApp.  The service will soon be available.

The multi-faceted collaboration between THAI and Siam Piwat is a synergy of two business leaders that  brings limitless opportunities. The two parties together create and deliver top-level experiences to customers of both companies. This is an ideal Co-Creation that paves ways to new opportunities and new growth engine, opens doors to more business opportunities and leverages the level of competitiveness in the industry. The exchange of knowledge and know how effectively supports business growth, the expansion of existing customers and reaching to new customers.

 

Sourse : The Nation Thailand

Indonesia’s $7.56b Trade Surplus in April Sets New Record

Indonesia booked a trade surplus of $7.56 billion in April, thus beating the country’s all-time high, the National Statistics Agency or BPS recently announced in a conference. 

"This is the highest trade surplus. Our previous record high of $5.74 billion dates back to October 2021,”  BPS chief Margo Yuwono told a virtual press briefing on Tuesday. 

This also marks the 24th consecutive month that Indonesia posted a trade surplus since May 2020. 

Indonesia's overall exports jumped 47.76 percent year-on-year to $27.32 billion in April. Indonesia last month imported $19.76 billion, expanding 21.97 percent year-on-year, according to BPS.

“The trade surplus mostly came from animal or vegetable fats and oil, followed by mineral fuels. The US, India, and the Philippines were the top contributors to the latest trade surplus,” Margo said. 

Indonesia exported about $2.4 billion to the US in April. The Southeast Asian country's imports from the US stood at $830.7 million, thus resulting in a trade surplus of $1.6 billion. Margo attributed the positive trade balance with the US to apparel and footwear exports.

According to Margo, Indonesia's non-oil and gas trade balance with India in April registered a $1.5 billion surplus. Indonesia booked a trade surplus of $977.9 million with the Philippines in the same month. Mineral fuels were the largest contributor to the trade surpluses with India and the Philippines.

“At the same time, we are seeing a trade deficit with a number of countries. Indonesia's largest trade deficit last month was with Argentina, which reached $320.2 million,” Margo said. 

The BPS data showed Indonesia's overall imports from Argentina reached $349.3 million in April. This far exceeded the $29.1 million Indonesia had exported to Argentina last month. BPS reported that Indonesia's bilateral trade with Australia was the second least favorable, with a deficit of $283.5 million in April. 

Margo went on to say that cereal imports largely contributed to Indonesia's negative trade balance with Argentina. The same goes for the deficit with Australia, although mineral fuel imports were the largest contributor to the negative bilateral trade balance.

The high cereal imports from the said two countries possibly ensued from the ongoing war in Ukraine, which has been a major wheat supplier for Indonesia.

"We can conclude that we are shifting some of our [cereal] imports from Ukraine [to] Argentina and Australia," Margo said.

Cambodia, Singapore vow to ramp up cooperation

Cambodia and Singapore have pledged to step up cooperation to bolster bilateral trade, after registering more than $5.2 billion last year, marking a nearly 50 per cent jump over 2020.

The commitment was made at a bilateral meeting on May 18 between Minister of Commerce Pan Sorasak and his Singaporean counterpart Gan Kim Yong in Bali, Indonesia.

 

Sorasak took the occasion to thank Gan for the Singaporean Ministry of Commerce and Industry’s support for Cambodia’s ASEAN chairmanship, pledging to work hard to spur bilateral trade.

“We are committed to continuing cooperation to bolster bilateral trade between Cambodia and Singapore, taking it to greater heights,” he said.

 

Both sides agreed to arrange an event soon in Singapore for stakeholders to share experiences and explore key areas of interest further in-depth, in hopes of improving the capacity of the private sector, especially Cambodia-based micro, small- and medium-sized enterprises (MSME).

Hong Vanak, director of International Economics at the Royal Academy of Cambodia, suggested that the success of international trade hinges on the export portfolios of each country, adding that expansions in networks of business relationships correlate to more and stronger benefits.

Given its proximity to Cambodia and deep-sea ports, forging deeper relations with Singapore will improve freight transportation from Cambodia to the world, he said.

For full article, please read here



Author: Hin Pisei
Source: The Phnom Penh Post 

Rate hike concerns spook stock investors

Thai stocks extended losses on Monday as investors worry strong US jobs reports and the prolonged Russia-Ukraine war will drive the Federal Reserve to move with more aggressive and quicker rate hikes to fight inflation. The markets expect the war will keep energy prices high, making it more challenging for central banks globally to control inflation while the global economy slows.

Global stock markets on Monday continued to fall from the week before. The Nikkei 225 opened at 26,705.32, down 298.24, or 1.1%, while the SSE Composite Index opened at 2,990.20, down 11.36. or 0.37%. The Hong Kong stock markets were closed for a public holiday. According to Dow Jones market data, the Dow Jones Index fell for the sixth straight week, while the Nasdaq closed at its lowest level since 2020. The S&P500 Index also fell for the fifth straight week, the longest stretch since the second quarter of 2011.

The SET Index on Monday closed at 1,604.49, down 25.09 points or 1.54%, with trading worth 81.6 billion baht. Veeravat Virochpoka, vice-president of Finansia Syrus Securities, said investors are worried that the strong US job numbers will drive the Fed to accelerate interest rate hikes. Traders expect the Fed to raise interest rates by 0.75 percentage points at the next meeting, although Fed chairman Jerome Powell has denied it.

He said inflation could rise further due to the protracted war because long-term energy bans on Russia have failed to deter Russia from attacking Ukraine while oil prices keep rising. He said if the core inflation rate rises to 3-4%, the Bank of Thailand (BoT) may decide to raise interest rate by a quarter of a percentage point this year from 0.5% to 0.75%. However, the central bank will also take domestic economic conditions into consideration when deciding whether or not to raise the interest rate, Mr Veeravat said.

Prospects of rate hikes and monetary policy tightening amid high inflation usually drive investors to offload risky assets such as stocks and cryptocurrencies, resulting in price drops, he said. Mr Veeravat said the SET Index may fall below 1,600 points, and the next support level would be 1,570 points. For investment strategy in the short term, Finansia recommends consumer and hospital stocks.

Bitcoin dropped below US$34,000 on Monday to its lowest level in four months. Cryptocurrency will recover when inflation is lower and the economy recovers, he said. "The factors that worry investors the most are inflation and the war. We suggest holding more cash and waiting to invest during a period of market correction," Mr Veeravat said.

 

Sourse : Bangkok Post

Diesel to be capped at B32 per litre

The retail price of diesel in Greater Bangkok will remain capped at 32 baht per litre, as the government has tried to continue its energy subsidy measures to help alleviate people's hardship and reduce their cost of living. According to the director of the Oil Fuel Fund Office (Offo), Wisak Watanasap, the board on Monday agreed to continue capping the retail diesel price at 32 baht per litre for another week.

The government earlier decided to allow the price of diesel, which had been capped since October 2021, to gradually increase starting from early this month, with the price expected to increase to 33 baht per litre as of Monday morning. Mr Wisak said the Offo is scheduled to reassess the direction of the retail diesel price this Friday.

The actual retail price of diesel is now quoted at 43.5 baht per litre in Greater Bangkok including tax and levy collection. According to Offo, the state diesel subsidy has now risen to 11.35 baht per litre from 9.55 baht per litre a week ago and from 9.57 baht per litre two weeks ago, as global oil prices rise.

As of Sunday, the Oil Fuel Fund, which provides the subsidy, was 66.6 billion baht in the red, 33.2 billion baht of which was for oil and 33.4 billion baht of which was for cooking gas. Mr Wisak said Offo is also accelerating obtaining a 20-billion-baht loan, possibly by June, to maintain the fund's liquidity.

State-run Government Savings Bank and Krungthai Bank are on Offo's shortlist as potential loan providers. Last month, the cabinet approved an additional loan of 10 billion baht on top of a former loan to keep the fund operational.

Mr Wisak said that global oil prices traditionally decline after the end of the winter season, but they are still on the rise due to the protracted Russia-Ukraine war. The Oil Fuel Fund currently spends a combined 860 billion baht per day to subside energy prices, 781 million baht of which is used to subsidise oil prices and 78.8 billion for the LPG price subsidy.

Wattanapong Kurovat, director-general of the Energy Policy and Planning Office, said energy authorities are expected to discuss the possibility of lowering the content of methyl ester (ME), also known as purified biodiesel (B100), in biodiesel from 5% or 5 baht now. Costly ME is now quoted at 62.74 baht per litre, doubling the diesel prices. Every 1% reduction in ME content in diesel could lower the retail price by 0.25 baht per litre.

The new proportion of ME content in diesel will not be confirmed until this Friday. Deputy Prime Minister and Energy Minister Supattanapong Punmeechaow said the authorities are planning to lower electricity tariffs by adding up long-term contract purchases of liquefied natural gas from costly purchases in the spot market.

 

Sourse : Bangkok Post

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