Here's how badly Singapore agribusiness players were hurt by weak CPO prices

Prices crashed by 25%.

According to OCBC Investment Research, most CPO (crude palm oil) companies reported fairly disappointing 1H13 results recently, no doubt hurt by weaker CPO prices in 2Q13 (CPO prices fell 25% YoY and another 5% QoQ).

Here's more:

Under our coverage, Golden Agri’s (GAR) 1H13 earnings only met about 34% of our full-year forecast. Global Palm Resources (GPR) was even harder hit, as its 1H net profit met just 27% of our fullyear forecast.

Wilmar International Limited (WIL) fared slightly better, with 1H13 core earnings meeting 40% of our FY13 forecast, as its substantial downstream business helped to mitigate the poorer upstream showing.

Outlook for CPO prices still quite muted
But going forward, the outlook for CPO prices remains largely muted, given the sluggish economy in China (one of the biggest buyers of CPO and other vegetable oils), while even Indonesia’s economy1 could be facing increased headwinds due to reduced spending power on the back of a higherthan-expected spike in inflation and a sharp
weakening in the IDR1.

On the supply side, things are not looking too good either – CPO production as well as the other vegetable oil substitutes are expected to increase in 2H13.

Based on current estimates, market watchers like Oil World1 believe that “world production is likely to exceed demand”.

The Hamburgbased industry researcher adds that there is little scope for more growth in demand for vegetable oils to make biodiesel, citing unchanged biodiesel mandates in the EU and “hesitatingly” implemented increases in Brazil and Argentina1.

If you've been wondering whether SBR could work for your company — yes, probably.

A lot of the companies we partner with started as readers. They'd been following our coverage for a while, saw their own customers and competitors in it, and eventually asked the obvious question: could we do something with you? The answer is usually yes. The shape of it depends on what you're trying to do.

The options are broader than most people assume — thought leadership articles, sponsored content, industry summits across Southeast Asia, regional awards programmes, podcasts, and media placements in print and digital. Some partners use one channel; most use a mix. We figure out the right combination by starting with your brief, not with our rate card.

So if the question has been on your mind, here's the easy way to ask it.

We'll tell you honestly whether we can help, and how. It's a better use of everyone's time.

Book a meeting

| Or download the media kit (PDF)

240,000 senior readers quarterly in print Top 1,700 Singapore companies reached

7 markets across Southeast Asia