Khor Report's Palm Oil Nov/Dec 2013, Issue 5 (now available)

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Earlier, we had released some of the draft articles in this blog. Click on the links below!

KHOR REPORTS' PALM OIL NOV/DEC 2013, ISSUE 5: Feeding Africa, Asian companies eye West Africa consumers with palm oil, instant noodles and more
Feature: Indomie, Unilever & Olam in W Africa. Instant noodles & global hunger
Indonesia’s landholding ceiling, Felda Global deals & more
Biofuel policy cooling and boost, Neste Oil’s renewables
Sustainability: more certification, snacks & supply chain
Preview: RSPO hot topics

Editorial - unprecedented policy challenges, time to restrategize?
Indonesia ceiling on landholdings.
Felda deals & more.
Biofuels policies falter but Indonesia boosts.
Neste Oil’s renewables.
More certification.
RAN on snackfoods & supply chain.
RSPO preview.
Feature:  West Africa. Instant noodles.
Key vegetable oils.
Weather outlook.
CPO technical view.
Price charts.

Source: Khor Report's Palm Oil Nov/Dec 2013, Issue 5 (released)

Editorial: Time for new strategies?

There’s a pricey proposal from the RSPO and increased supply-chain pressure. Key markets cool while producer biodiesel efforts slowly get into gear. Add on Indonesia’s shift to implement a landholding ceiling and Malaysia’s policy adjustments for sustainability. Top this all off with no clarity on a trajectory for haze smog alleviation. Overall, the palm oil sector faces unprecedented cost parameter and growth model challenges. Time to restrategize?

First, reconsider the role of palm oil in local energy use. Malaysia’s biogas directive is a good starting point. Set for 2014 launch, it requires every mill to set up a biogas facility for methane capture; presumably to improve the greenhouse gas (GHG) profile for Malaysian palm oil. Aside from implementation and technological risks, there are obvious suggestions to improve Malaysia’s feed-in tariff for biogas power and allow easier grid connection. Khor Reports suggests a feasibility study on microgrids for remote areas. In the semi-urban zone this might challenge an incumbent power utility and it would work less well in countries with subsidized power. However, could this help firmly establish the localized use of palm biogas, biomass and biodiesel? Many developing countries sorely need power in certain rural areas. They could encourage mills siting next to a mining facility or another energy hungry user. Economists might plan for processing clusters that could aid rural development.

How about on sustainability? Redd+ efforts are of interest to policy makers, despite Ecuador’s Yasuni alternative funding model finding insufficient takers. The opportunity cost may have long pointed to oil palm development instead of conservation. How can this be improved for viability? Peat lands are probably the prime areas for such efforts and new proposals at the RSPO could tilt the financial calculus. What about the RSPO? It has helped some large plantations maintain market access to the large global brands. Khor Reports has long been of the view that its exclusive / non-inclusive strategy has obvious limits. Its planners poorly recognize the fact that small farmers in developing countries just aren’t like those back home in Europe. How will even more exclusivity via the Palm Oil Innovation Group become of general relevance? Notably, the RSPO’s gold standard approach already has limited if no hope of addressing key problems, including the annual peat smog. Thus, we challenge sustainability experts to this task: get rid of the peat smog problem within three years. NGOs and corporate players from various sectors (not just palm oil) need to get “down and dirty” to effect change at the local and provincial levels. Help small growers and farmers. Do something about raising the water tables in fire prone areas? Governments could facilitate. The current voluntary, top-down (so called market-led) efforts, hardly seem fit for such purpose. What can sustainability do for the peat smog that hits annually? We need a new bottoms-up approach.

In this issue, we feature Asian palm oil and consumer good companies eyeing West Africa’s market prospects, with instant noodles as a key product. I eat more than the average 14 packs per year, helping global consumption exceed 100 billion packets in 2012. Some academics reckon it has helped alleviate global hunger. While interest of the EU and US in biofuels dips, Neste Oil’s renewable fuel business boosts its prospects. In sustainability, certification is expanding and NGO campaigning in the US is in the limelight. What are hot topics for the upcoming RSPO Roundtable? Its proposed Compensation Procedure bares its financial teeth, with retroactive charges and fees on non-RSPO. Khor Reports conservatively estimates an initial USD 500 mill paid by growers, most likely into NGO hands for conservation.

Source: Khor Report's Palm Oil Nov/Dec 2013, Issue 5 (released)

Khor Reports' Palm Oil #4 newsletter: Indonesia's boom, plantations earnings crunch, price expectations for 2H2013 & more

KHOR REPORTS' PALM OIL SEP/OCT 2013, ISSUE 4: Malaysia biogas, India refinery woes, Liberia investor hiccup. Green performance chemicals. Sustainability: after haze, RSPO+, labour worries.
Supplement: EU withdraws GSP privileges, Malaysia mulls TPP standard, Indonesia’s farmer protection law, Pakistan FTA

View our newsletter here:

Malaysia biogas directive.
India refinery angst.
Liberia investor hiccup.
Green performance chemicals.
CSPKO premium jumps.
After haze.
More migrant worker rights?
Feature: Indonesia’s boom. Plantations earnings crunch.
Key vegetable oils.
Weather outlook.
CPO technical view.
Price charts.
Supplement – trade briefing 
     EU withdraws GSP benefits. 
     TPP new stds for Malaysia?
     Indonesia farmer protection law.
     Indonesia-Pakistan FTA

Khor Reports' Palm Oil #3 newsletter: Trade tussles, corporate outlook, prices & more

KHOR REPORTS' PALM OIL JUL/AUG 2013, ISSUE 3: Trade tussles. Corporate: Who’s got the best prices & growth prospects? EU biodiesel: certification, anti‐dumping & ILUC. Nigeria worries about duty evaders. Better info on saturated fats & Vitamin E tocotrienols. Frontier expansion: Nigeria, Mindanao & more. Price outlook muted, eyes on China & crude oil.

View our newsletter here:
(**kindly note this was updated on 10 July 2013, including pg. 7 on average selling prices; earlier version was 2 July 2013).

Indonesia’s four land bank issues.
Malaysia’s new minister. 
Saturated fats targeted in standards setting.
Vitamin E tocotrienols.
EU biodiesel certificates.
Indonesia’s new customary forests.
SE Asia’s peat fire season – 20% in OP concessions?
Feature: Trade tussles: EU anti‐dumping duties, new sustainability rules, Argentina’s WTO move, TPPA & GM concerns; Nigeria’s palm protectionism.
Corporate outlook.
Nigeria investors & recent frontier plans. 
Key vegetable oils.
Weather outlook.
CPO technical view.
Price charts - including Oil World's latest price view

Khor Reports' Palm Oil #2 newsletter: Carbon thresholds, biodiesel & more

KHOR REPORTS' PALM OIL MAY/JUN 2013, ISSUE 2: The Carbon Conundrum: Carbon thresholds on deforestation & peat? Palm producers push for biodiesel mandates. Natural: Red palm oil and the organic frontier. Fat standards & fat targets.Chocolate campaigns & Norway’s realignment.

View our newsletter here:

Indonesia's 100,000 ha ceiling? 
East Malaysia factors. 
Frontiers grow organic.
EU transfat and Australia SAFA cuts target. 

Natural claims for red palm oil.
US & UK choc campaigns.
Norway repositions. 

Ferrero fights back.
The carbon conundrum: deforestation & peat, Indonesia’s
moratorium and detecting deforestation.
Malaysia producers push for biodiesel.
Key vegetable oils. 

Weather outlook. 
CPO technical view. 
Price charts.