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Eng - IOI Group

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Management’s Discussion and Analysis cont’dGROUP BUSINESS REVIEWMature Oil Palm Area/FFB ProductionHA (‘000)160ActualProjectionMT (‘000)4,5001501404,0001303,5001201103,000100902,500802,00070602003 2004 2005 2006 2007 2008 2009 20101,500Matured HA (‘000)FFB Production MT (‘000)OUTLOOK & PROSPECTSOn the price front, it is a given that prices for FY2008 will average significantly higher than FY2007; in our view at least 30%higher, in view of bullish fundamentals. Current spot month of September 2007, CIF Europe prices for rapeoil, soyoil and sunfloweroil are all above USD1,000 PMT whilst crude oil is above USD80 per barrel. It is therefore likely that palm oil price will moveto another record high again to close the price gap if the other oil prices stay at these high levels. There should therefore be asubstantial jump in earnings level for FY2008, in line with the price increase.35ANNUAL REPORT 2007<strong>IOI</strong> Corporation Berhad

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