Directors - Boustead Holdings Berhad

Financial Highlights Average Prices Realised
RM Million
1,500
1,200
900
600
300
MARKET REVIEW
0
487
453
Revenue Operating Profit Total Assets
Employed
2006 2005
54
The strong soybean harvest from South America and
huge stockpile of palm oil made the palm oil market
relatively weak in the first half of the year. There were
also speculations that the hype on biodiesel would
gradually disappear following the fall of mineral oil
prices from USD78 to USD57. However, this
downturn was not mirrored by the CPO market which
instead sustained its upward trend. The take-up for
CPO was mainly derived from legislated demand, as
Governments worldwide made a commitment to
reduce emissions of greenhouse gases.
34
1,419
1,130
RM
1,500
1,200
900
600
300
0
Palm Oil
Per MT
2006 2005
Palm Kernel
Per MT
FFB Per MT
Production Employees Planted Area
Thousand
1,500
1,200
900
600
300
0
248
238
Palm Oil
(MT)
2006 2005
60
59
Palm Kernel
(MT)
1,262
1,215
FFB (MT)
New Sugut Mill, Sabah
100,000
80,000
60,000
40,000
20,000
0
1,464
10,009
1,375
9,969
2006 2005
862
981
266
76,694
261
78,238
Number Oil Palm (ha)
The market for palm oil was also fuelled by the
mandatory labelling of items containing trans-fatty
acids within the food sector. This contributed to a
19% increase in palm oil exports to the United
States. The huge appetite for palm oil from major
economies such as China and India had a positive
impact on CPO prices. Coupled with the
abolishment of import quota earlier in the year in
China, palm oil exports increased by 21% to hit a
high of 3.58 million MT.
The Division recorded an average price of RM1,464
per MT which was an improvement of 6% from last
year’s price of RM1,375 per MT. Our gross CPO
selling price of RM1,514 per MT was also above
the industry average of RM1,511 per MT.
43