Socio-economics

Coconut farmers face surging imports in Malaysia

#Malaysia #coconut #imports have seen a notable surge from Dec 2017. Khor Reports’ has taken a preliminary look at some of the data surrounding the story "Millions of local coconuts left unsold," 27 Dec 2018, The Star.

The Department Agriculture reports reports some 80,000 hectares of coconut planted areas mainly in Sabah, Sarawak, Johor, Perak and Selangor, mostly planted by farmers.

A specialist said, "The situation on the ground is bad. Who ever approved the (imports) were doing the local kampong folks a disservice. If you speak to the small farmers on the ground they are annoyed with (the imports). The small players - and with that the voters - will be disadvantaged and they will be confused because they see no action being taken." (Interview, 30 Dec 2018).

Indeed, imports from Indonesia were about 130 million kg in 2016, 180 million kg in 2017, and 187 million kg in 9 months of 2018 (Jan-Sep, the data is not yet available for Oct-Dec 2018) with peak imports of about 25 million kg/month in Mar, Apr, May 2018. 1 kg is about 1 nut.

Jul 2015 - Sep 2018 monthly data. Source: Khor Yu Leng, Khor Reports - Segi Enam Advisors.

Jul 2015 - Sep 2018 monthly data. Source: Khor Yu Leng, Khor Reports - Segi Enam Advisors.

In reviewing the monthly trade data prepared by Khor Reports (see line graph above), a coconut expert noted, “This is very revealing and it is the imports that is causing this problem. There is a glut in the markets, and it is still a problem.” (Interview, 9 Jan 2018).

Imports were equivalent to 15-20% of production in mid-2015 and imports rose to around 55% production-equivalent in Mar-May 2018, around the time of the regime-changing 14th General Election in May 2018. In retrospect, we may ask if coconut problems added to rural angst and the big protest vote among younger voters in rural and semi-urban areas against UMNO-BN.

After the election, it appears that UMNO-BN’s high coconut imports policy was broadly maintained; with imports easing under the new Pakatan Harapan administration, but it remained significantly above trend, Jun-Sep 2018 (see chart below).

The top 4 suppliers of Malaysia imports in Sep 2018 were Indonesia (by far), Philippines, Singapore (surprisingly) and Thailand. Looking at a longer time-frame, coconut imports to Malaysia have risen some 10-fold from mid-2008 to mid-2018, but there was a time period when imports were clamped down, notably mid-2013 to almost mid-2014, the period after the 13th General Election (held in May 2013).

Jul 2008 - Sep 2018 monthly data. Source: Khor Yu Leng, Khor Reports - Segi Enam Advisors.

Jul 2008 - Sep 2018 monthly data. Source: Khor Yu Leng, Khor Reports - Segi Enam Advisors.

Looking ahead. The coconut imports data for Oct 2018 and forward will no doubt be closely watched. The question is: What will be Malaysia’s policy on coconut imports be in view of complaints from local coconut traders and farmers ?

Comparative context. The palm oil sector in Malaysia has also seen domestic stockpiles rising to record highs. Reuters reported, “To counter the Indonesian import, (Minister) Kok said the government is "currently encouraging our companies to use domestically produced palm oil to reduce the stockpile…. By reducing imports, we could see a significant reduction in palm oil stocks in Malaysia and this would boost prices." " For both palm oil and coconut, Indonesia holds significant cost advantage.

Indonesia perspective on farmer interests. In the run up to the Indonesia presidential election, Tempo (9 Jan 2019) reports that "candidate pair number 02 had committed not to use identity politics in the 2019 presidential election...The economic programs are the answer to the problems experienced by people at the grassroots level such as farmers, laborers, and housewives. “When we visit the regions, there must be complaints from residents, especially from farmers,” he said... if Prabowo-Sandiaga becomes president and vice president, they will try to reduce the import of commodities that can be produced in Indonesia." Earlier, SCMP reported (19 Dec 2018) that "Indonesia is the world’s second-largest sugar importer and keeping food prices low is critical for voter support ahead of April’s vote. But the country is also home to a vocal contingent of sugar farmers who want to sell for higher prices.... Indonesia is already the world’s second-largest sugar importer behind China though by some accounts, it is actually first. Raising its import quota would feed growing demand from hungry consumers...Data from state logistics agency Bulog indicates the decision to allow more imported sugar has stabilised the price at about US$1 per kg. This, however, has been seized upon by Widodo’s political rivals as evidence his administration will prioritise consumers at the expense of farmers."

#Jokowi #Prabowo #Sandiaga #sugar #palmoil #coconut #PakatanHarapan #UMNO #import #tradepolicy

Notes:

Coconuts policy is lead the Ministry of Agriculture. Palm oil policy is led by the Ministry of Primary Industries.

Product: 0801 Coconuts, Brazil nuts and cashew nuts, fresh or dried, whether or not shelled or peeled. For Malaysia, this category is dominated by coconuts.

Key indicators for HSR projects by Khor Yu Leng

Yuleng_CNA_HSR.JPG

I have been reviewing some general stats for a #HighSpeedRail project comparison. RM1-trillion-in-debt (US$250 million) Malaysia is relooking its KL-Singapore HSR project (#MyHSR #SgHSR), and I take a look at the Taipei-Kaohsiung HSR which has intriguing similarities including the price tag.

Commentary in Channel News Asia published on 2 July 2018, available here.

Rapid transit is looking into novel systems. In recent news #ElonMusk's 2013 novel tube-transit #HyperLoop idea is getting a serious look by Chicago (albeit a more basic #Loop non-vacuum or conventional tunnel version)! Notably, no taxpayer money (nor hidden guarantees, presumably). It is private funded. "In exchange for paying to build the new transit system, #BoringCo would keep the revenue from the system’s transit fees and any money generated by advertisements, branding and in-vehicle sales." Chicago set transit time and ticket cost hurdles, and got four bidders.

Back to conventional HSR. In summary, Malaysia cost concerns include:

·       A lower project cost. In consideration of the high debt situation, and to lower fares.

·       A lower fare, to undercut the cost of air travel between Singapore and KL. 

·       A lower fare, for an affordable domestic service for the average Malaysian. 

There will no doubt be a wider discussion on the #socioeconomic implications of HSR and lower-cost medium-speed rail options now mooted (at 1/3 the cost of KL-Singapore HSR) . The #Mahathir administration is mandated to improve the livelihoods of the average Malaysian and look into issues of jobs, incomes, affordability of homes, and the cost of living. Sources reckon that part of the KL-Singapore HSR justification is property development and a ramp up in property prices. If this is so, it may not sit well with ongoing concerns about affordability.

Please  contact us  for detailed data and analysis; and for redistribution.  (c) 2018 Khor Reports - Segi Enam Advisors. All rights reserved.

Please contact us for detailed data and analysis; and for redistribution.

(c) 2018 Khor Reports - Segi Enam Advisors. All rights reserved.

Malaysia: Johor property & prices, Jan 2018

There could be a quarter million Singaporeans  visiting Johore each week. Thanks to newly available data about cross-border traffic volumes we have better estimates of the to-and-fros of Singaporeans and Johoreans. Are Singaporeans really to blame for pushing up Johor property values (Part 1) and the cost of everyday goods and services (Part 2)? The simplistic blame-the-Singaporean game seems to be long over-stated. The data and a wider reading of the issue suggests strong domestic forces at play too.

There is no doubt that Singapore cash is sought by restaurants, retailers, and property developers. Johor households are impacted by rising prices; with urban and rural folk also pinched by household debt. Recent surveys point to pro-development views among Johoreans (especially rural), along with a dip anti-Singaporean feelings. Do they recognise homegrown issues contributing to Johor’s price inflation; and do they balance this against income opportunities from Singapore FDI and its open job market?

In Part 1, we review the indicators for the property sector and found it hard to lay the blame fully on just one sector of buyers - Singaporeans. In Part 2, the data suggests that the impact of foreign visitors adds to domestic-origin pressures; and Johor suffers the highest price inflation in all Malaysia. Urban households face debt concerns and rural households are pressured by price increases.

#Malaysia #Johor #Singapore #AffordableHousing #CostofLiving #HouseholdDebt #Felda #KhorReports

Read Part 1 by clicking here: On Johor Property by KHOR Yu Leng 

Read Part 2 by clicking here: On Johor Prices by KHOR Yu Leng

Johor price inflation versus other states  (c) 2018 Khor Reports - Segi Enam Advisors Pte Ltd. All Rights Reserved.

Johor price inflation versus other states

(c) 2018 Khor Reports - Segi Enam Advisors Pte Ltd. All Rights Reserved.

Johor Bahru urban household and Johor Felda rural household surplus and debt  (c) 2018 Khor Reports - Segi Enam Advisors Pte Ltd. All Rights Reserved.

Johor Bahru urban household and Johor Felda rural household surplus and debt

(c) 2018 Khor Reports - Segi Enam Advisors Pte Ltd. All Rights Reserved.

Malaysia's Structural Reliance on Foreign Labour - A Data Report (Khor Reports)

We've released a new data report on our analysis of Malaysia's structural reliance on foreign labour. To access the full data report, sign up for our newsletter in the form below to receive your exclusive password to the report! The report is accessible at this link. Malaysia's Structural Reliance on Foreign Labour (Khor Reports)

A preview of the report

A preview of the report


We analysed some interesting data on foreign labour in each Malaysian state and district from the Department of Statistics Malaysia (DOSM) - using data on citizen and non-citizens - and found some surprising results. Sabah's share of foreign labour was the highest in the country, at approximately 37%, followed by Selangor at 11%. 

Non-Citizens and Citizens (2016) by State

(c) 2018 Khor Reports - Segi Enam Advisors Pte Ltd. All Rights Reserved.

#Labour #MigrantWorkers #PalmOil #Sustainability #RSPO #Johor #Sabah #Malaysia #SoutheastAsia #KhorReports

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The full data report is accessible at this link. Malaysia's Structural Reliance on Foreign Labour (Khor Reports)

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