TEFD: What are your expectations for 2012, for your company and the industry? What impact, if any, do you expect from the euro crisis?
Lee: Plantation companies have had an outstanding year in 2011, with crude palm oil (CPO) and palm kernel prices at a buoyant and lucrative level. As we approach 2012, with the debt crisis in EU affecting market confidence, this has translated into a worrisome pressure on palm product prices, along with the other commodities.
Whether 2012 will bring further economic deterioration is highly uncertain and if so, it could drastically affect demand for our commodities. The European Union is among the largest consumers for palm products, both in the food and energy sectors.
Fortunately, fundamentals for the supply of oils and fats for 2012 are reasonably good with anticipated slower yearly growth from palm oil. Demand growth, save for the above exception, is expected to surpass growth in supply. On balance, our opinion is that palm prices should be in the RM2,800 to RM3,300 per tonne range, not as bullish as some had forecast.
What is your company’s plans and focus for the coming year?
KLK’s plans for 2012 in our three focused areas are:
Plantations — to ensure quality new plantings and replanting standards while improving the productivity per ha to our target of six tonnes of oil per ha in the near term. This is essential for our well-being due to the plantation industry being a cyclical price taker and to enable us to satisfy our workers’ aspirations for increasing wages cum better living standards.
Oleochemicals — we are enhancing our competitiveness through capacity expansion, de-bottle necking existing plants, developing skill sets and building espirit de corp in our organisations. This is to prepare for the foreseeable basic oleo over-capacities, resulting from Indonesia’s duty structure.
Coupled with the above strategies, we are also embarking on new refineries and a fatty acid plant in Indonesia. Finally, integrating further downstream into more complex oleo derivatives is our consistent focus.
Property — our maiden launch of KLK affordable homes in the 1,000-acre Bandar Seri Coalfields have been extremely well received. Integrating into this affordability theme is to have the necessary environment for a better living, quality and secured lifestyle.
What is your wish list for 2012?
Like all Malaysian corporations, we are stewards in a highly competitive world. We are trustees for the future generations and thus have a huge responsibility to ensure we are competitive, productive and efficient in our business. Our purpose must be to train our people well, ensure a meritorious system and be good corporate citizens benefiting the society where we operate.
For 2012, we wish that all organisations — be it commercial, political or others — will fulfil corporate governance, especially on corruption, with love for our nation foremost in our policies so that the future generations will look back with appreciation at the legacies we leave behind.
This article appeared in The Edge Financial Daily, December 27, 2011.
Lee: Plantation companies have had an outstanding year in 2011, with crude palm oil (CPO) and palm kernel prices at a buoyant and lucrative level. As we approach 2012, with the debt crisis in EU affecting market confidence, this has translated into a worrisome pressure on palm product prices, along with the other commodities.
Whether 2012 will bring further economic deterioration is highly uncertain and if so, it could drastically affect demand for our commodities. The European Union is among the largest consumers for palm products, both in the food and energy sectors.
Fortunately, fundamentals for the supply of oils and fats for 2012 are reasonably good with anticipated slower yearly growth from palm oil. Demand growth, save for the above exception, is expected to surpass growth in supply. On balance, our opinion is that palm prices should be in the RM2,800 to RM3,300 per tonne range, not as bullish as some had forecast.
Lee: Whether 2012 will bring further economic deterioration is highly uncertain.
What is your company’s plans and focus for the coming year?
KLK’s plans for 2012 in our three focused areas are:
Plantations — to ensure quality new plantings and replanting standards while improving the productivity per ha to our target of six tonnes of oil per ha in the near term. This is essential for our well-being due to the plantation industry being a cyclical price taker and to enable us to satisfy our workers’ aspirations for increasing wages cum better living standards.
Oleochemicals — we are enhancing our competitiveness through capacity expansion, de-bottle necking existing plants, developing skill sets and building espirit de corp in our organisations. This is to prepare for the foreseeable basic oleo over-capacities, resulting from Indonesia’s duty structure.
Coupled with the above strategies, we are also embarking on new refineries and a fatty acid plant in Indonesia. Finally, integrating further downstream into more complex oleo derivatives is our consistent focus.
Property — our maiden launch of KLK affordable homes in the 1,000-acre Bandar Seri Coalfields have been extremely well received. Integrating into this affordability theme is to have the necessary environment for a better living, quality and secured lifestyle.
What is your wish list for 2012?
Like all Malaysian corporations, we are stewards in a highly competitive world. We are trustees for the future generations and thus have a huge responsibility to ensure we are competitive, productive and efficient in our business. Our purpose must be to train our people well, ensure a meritorious system and be good corporate citizens benefiting the society where we operate.
For 2012, we wish that all organisations — be it commercial, political or others — will fulfil corporate governance, especially on corruption, with love for our nation foremost in our policies so that the future generations will look back with appreciation at the legacies we leave behind.
This article appeared in The Edge Financial Daily, December 27, 2011.
