Member Info for JohnLewis79

CPO $ 560.60.
CPO Sept futures $566.90.

India currently imposes a 40% tax on CPO and 45% on RPO oils from Malaysia. The Ministry is recommending an extra 5% tax raise for a period of 6 months.
The extra revenue would be used to help boost their stagnating oilseed production.

In other news Malaysia is considering as part of the new 10yr defence plan to use palm oil to pay for arms as they seek to replace old equipment to boost defence capabilities. The Govt have been in talks with neighbouring counties seeking to barter oil for guns.
No details as to quantity or value were disclosed.

CPO close 568.50.
L 563.
H 574.
IDR 14240.

In a shocking report by a Govt audit it was found that c.81% of palm plantations were flouting numerous regulations.
These included:

* estates larger than permitted.
* non compliance with IPSO standards.
* failure to allocate sufficient land to small holders.
* No permit to cultivate.
* overlapping into mining concessions.
* draining of carbon rich peat lands, which become highly combustible during the dry season.
* plantation maps unavailable to the public despite Govt insistence.

The BPK (Govt auditor) declined to name the companies, only saying they held concessions to millions of ha across the country and he will be reporting his findings to President Widodo to decide on follow up action.
The BPK findings echo the results of a similar audit carried out by the KPK a anti-corruption agency in 2016, which was in response to forest fires in 2015 among the most destructive ever seen.

Both audits from different Govt branches point to a massive compliance problem in the industry and lack of will by the Govt to tackle the problem.
They could start by enacting the moratorium
imposed by Widodo to freeze issuance of new plantation permits.

The Govt must fix/address these problems which would go a long way towards restoring trust in Indonesian Palm produce in export mrkts... especially the EU.

CPO $570.70.

Indonesia threatens to halt Airbus orders over the palm oil feud with the EU.
Indonesian Trade Minister
is asking PT Lion Airways to switch to Boeing.

Co founder of the Airline said "we will do whatever the Govt decides". Lion Air has placed orders for 8 Airbus 330 worth c.$2.4bn
adding to the 2013 order for 234 planes worth $24bn.
Trumps trade war with China, Mexico, Iran and the EU to name just a few
will hit the already slowing
global economy and he will get the blame, for whatever he and his supporters say an isolationist America will not prosper when world mrkts are closed to US goods and services.

Soybean will attract an added 5% duty on the existing 25% that US producers of veg oil will have to face.
On the car front, China imports thousands of cars from Trump's heartlands, South Carolina and Alabama motor assembly plants. The top 4 most popular being BMW, Mercedes, Lincoln and Ford.
These all face duties of c.25% which will severely hit jobs in US motor trade. I very much doubt Chinese buyers will stump up the extra to keep US workers in employment.

China intends to send a delegation to Washington
for more talks (15) and counting, seeking a way out of this ruinous trade spat.
However comments from Trump 'we don't need China' and 'they have been stealing' from us for years
don't bode well for any agreement.
As usual the unpredictable Trump will soon be tweeting 'welcome our dear Chinese friends' let's make 'happy'.

Indonesia is preparing to expand its downstream industry for palm oil to absorb potential over supply by 2024.
The Association of palm growers est output of CPO & PK0 will rise to c.50mt
this year and 60mt by 2025.

A bigger absorption of CPO is needed especially in industries such as chemical and textiles and the Ministry has plans to create an extra 12mt pa of absorption capacity by 2024 as currently Indonesia has only 125 palm derivative products while rival Malaysia has 300. The need to expand palm usage in more value added products is paramount.
To date Indonesia uses c.30% of its production domestically and mostly for food, cleaning products & recently biodiesel.

In other news the State Energy Co PT Pertamina has signed an initial agreement with the Italian oil Co Eni SpA to develop a refinery that would produce fuel completely derived from palm oil.
Also, the State Electricity Utility Co are converting 4
of its power plants to use palm based fuel.

These plans will help to use up any excess of oil production not being exported and benefit the economy.

Stock Investing for Dummies is a good start for beginners despite the title, now up to vol 5 and has had positive reviews. Author Paul Mladjenovic and is widely available on Amazon. I would also recommend two by Jim Slater 'Investment made Easy' and 'The Zulu Principle'.
Trust your well and hanging in there...."One day Rodders!"

US mrkts continued the tumble to near close when a few brave buyers appeared to stop the rot.
Dow was off 623 (after -745) or -2.4% the 500 fell 76 & Nsdq down 240.

Chinas announcement of new trade duties on $75bn
of US goods set to start Sept 1 & Dec 15 and worries that trade talks are going nowhere spooked investors.
It's not only China on Trumps hit list but he's at war with Fed Chair Powell
calling him a "bigger enemy" than Xi Jin Ping and the Central Bank not bending to his wishes of more rate cuts.
However much Trump dislikes China they are an essential part of the global supply chain and a huge mrkt for US companies desperate to reduce $bns of debt on their books.
At Q1 non financial corporate US businesses held over $9 trillion in debt.
After the mrkts closed Trump announced he would raise existing duties on $250bn of imports from China to 30% from 25% and 15% rather than 10% previously planned on the remaining $300bn of goods from Sept 1.

Whether Trump can enforce his 'tweet' for US companies to seek alternatives and firms to come home is unclear.
As ever with Trump he says one thing and does the opposite. Dow futures are pointing to a small bounce at Mondays open.

London closing quotes wk 34.

AEP +4 or u/c take your pick.
EPA u/c
DKL u/c
MPE -3 or +7 take your pick.
REA -5.5 or -15.5 take your pick.

Strange how difficult it is to agree a closing price. Under the old jobbing system i can understand but with computer instant access surely they could agree a mid price.

Late reporteds pushed vols up to 19338 on the session, shares off 5 to 132.50 at close.
One thing is for sure I am not a seller at anywhere near this price given duties on US soy and crude to China.

China may have dealt a mortal blow to American farmers by retaliatory measures of taxing US soybean and is shaping up to be a huge windfall to Indonesian & Malaysian palm producers. An extra 5% tariff is proposed on soybean and crude oil.

China is likely to import a record 6.7mt of palm oil in the year to Oct because rival soybean oil prices are surging as suppliers of beans used to produce animal feed shrink due to the on going trade war and African swine fever.

The price differential between soy and palm has soared as soyoil hovers near 2 year highs and China's soybean imports fell 11% in the first 7 months of 2019.
The large spread will continue to spur more palm oil imports which have risen c.15% in July from June.
Shipments are steady at
600,000t a month and China's consumption rose more than 20% in the period Jan-Jul due to price advantage over soy.

Indonesia saw June exports to China jump more than 30% from a year earlier to 435,000t and with higher tariffs on soybean palm is set fair for the foreseeable not to mention biofuel!

Wk34.
Looked good until mid morning when small lot sellers decided to sell out or go short ahead of interims due shortly.

Whatever the reason only a total of 13,323 were traded, (a few bottom fishers appeared late on) leaving the share u/c on the day (137.5) against an improving CPO price ($556.70) and c.$53 up in last 4 wks.
That's a 10% increase to the bottom line given much of plantation costs are on a fixed knowable basis.

Wk34.
sp +7.5
CPO +$7.70
IDR - R23

Late news:
Trump says" we don't need China" and orders US Co's to seek alternatives.
China has put duties of 5 & 10% on a range of US goods starting in Sept.
Crude was hammered WTI fell $1.47 to $53.88 and the Dow took a dim view of Trumps twitterings falling 494 at 17:00 UK.

Currently of the 16 bargains dealt only 2 have been on the buy side at 144.

c.£6m knocked off mrkt cap atm on 11.5k trades value c.£14k, makes a lot of sense but that's Aim for you!

120-130.
CPO $556.20

Morningstar has the up to date trades c.9-10k trades all at 117-120 ish. Total volume of 11, 397.

It's a very comprehensive report much of which is for the tech minded. However I agree biodiesel could make a comeback in 2020 according to one of the graphs if soya & oils etc get 5% duties tacked on imports from the US. Time will tell.

Mates rates on c.11500 trades?