Sunday, 11 October 2015

TREND OF COMMODITY PRICES ON THE DOWNTURN

Plantation commodity prices was determinant factor in the success of plantation business. Commodity prices would determine the amount of income from stakeholders in the supply chain like farmers, plantation enterprises, middlemen, Cooperatives, Joint Enterprises Units, Processing and Marketing, Industry/Semi Finished Goods Processing factories, exporters and the Government.

Commodity price was determined by supply and demand. Change of supply was determined by various factors which moved dynamically even in the security exchange which was price former body and herger; all the factors changed constantly fday by day.

According to Sinung Hendratno, a researcher of PT Nusantara Plantation Research through 2004 – 2014 commodity prices fluctuated dynamically with downturning trend since February 2011 for rubber and palm, down since January 2011 then relatively stable for sugar, down since September 2012 and notably stable for tea, up since May 2012 fir cacao and up since November 2012 and relatively stable and notably high level for coffee.

In 2013 world rubber production was posted at 12.04 tons with Thailand as biggest producer (34.5%); Indonesia (25.5%) Vietnam (7.9%), China (7.2%), India (7%) Malaysia (6.8%) and other countries 11.2%. Consumption 11.36 million tons, the biggest consumer being China (36.5%), India (5.8%), USA (8%) Japan (6.3%) Indonesia (4.3%), Thailand (4.6%), Malaysia (3.8%), Brazil (3.5%), South Korea (3.5%), Germany (2.2%) and other countries (18.4%).

In 2013 production of CPO came to 56.12 million tons with main producer being Indonesia (51%) then Malaysia (34%), Thailand (3%) and other countries (12%) while consumption totaled 57.2 million tons, the biggest consumer being India (15.3%) Indonesia (14%), EU (11%) China (11%), Malaysia (4%), Nigeria (3%), and other countries (37%).

Sugar production was 177.56 million tons the biggest producer being Brazil (21.8%); India (14.9%). EU (9.5%). China (8.5%), Thailand (5.8%), Mexico (3.5%), Russia (2.8%), Pakistan (2.7%), Indonesia (1.2%) and other countries (24.6%) while consumption came to 171.38 million tons with the biggest consumer being India (15.3%), EU (11%), China (9.4%), Brazil (7.2%), Indonesia (3.1%), Mexico (2.9%), Pakistan (2.7%) and other countries (42%).

Tea production was posted at 4.82 million Kenya 16%, India 15%, Vietnam 5%, Argentine 4%, Indonesia 3%, Uganda 2% and other countries 20%. Consumption came to 5.03 million tons the biggest being Russia 9%, England 7%, USA 7%, Pakistan 7%, Kenya 6%, Egypt 6%, Iran 5%, Marroko 3%, Germany 3%, Holland 2% and other countries 42%.

Cacao production was 4.45 million tons, the biggest producer being Ivory Coast 40%, Ghana 21%, Indonesia 10%, Nigeria 5%. Brazil 5%, Kamerun 4%, Equador 5%, other countries 10%. The world’s consumption was 4.26 million tons, the biggest producer being Holland 13%, Ivory Coast 12%, USA 10%, Germany 10%, Indonesia 7%, Malaysia 6%, Brazil 6%, Ghana 5% and other countries 31%.

Total coffee production was 152.51 million bags, the biggest producer being Brazil 35.7%, Vietnam 19.7%, Kolombia 7.9%, Indonesia 6.3%, Ethopia, 4.3%, India 3.4% and other countries 22.7%, while the world’s consumption of coffee was 142.42 million bags with the biggest consumption being EU 29.9%, USA 17.1%, Brazil 14.1%, Japan 5.3%. Canada 2.7% and countries 30.9%.

Basically the price of plantation commodity Indonesia was related to commodity prices in the world market. Therefore the many factors that influenced supply and demand at the world market whether in consumer or producer countries would determine prices in Indonesia.

The determinant factors that influenced demand in consumer countries were economic growth and policy in fiscal, monetary, the real sector, downstream industry and trading; population increase, low employment rate; purchasing manager index and inflation. The factors that influenced supply in producer countries were policies for production and investment in plantation commodity, inflation in producer countries, inflation in producer countries and trading in producer countries.

Study unveiled that in year 2015 price of rubber was at low level, with fluctuation: USD 1,41 – USD 1,58.kg.CPO was at low medium level with fluctuation USD 1,66 – US 1,85 .kg, sugar was at middle zone with fluctuation USD 0.26 – 0.32/kg tea was at middle zone with fluctuation USD 2.7 – 3.1/.kg, cacao was in middle in zone with fluctuation USD 2.63 – USD 2.98/kg; Robusta coffe at the medium high zone at USD 1.94 – USD 2.16 kg and Arabica coffee at middle zone with fluctuation USD 4.5 USD 4.7/kg. (SS)

Business News - July 3, 2015

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