Interim statement of the SIPEF group per 30 September 2019

October 17, 2019

  • For the first time this year, the Indonesian palm activities knew a quarter with rising volumes (+ 3.3%) compared to the same period last year.

  • The palm plantations in Papua New Guinea were hit three times by volcanic eruptions from Mount Ulawun, and this led to a 48.6% fall in the palm oil produced for the third quarter.

  • The total palm oil Group production decreased by 10.4% over the first nine months of the year.

  • The demand for palm oil, for both food and biodiesel purposes, was strong in August, causing the palm oil prices to peak at USD 590 per tonne CIF Rotterdam, but then again slightly fell back due to higher production in Malaysia.

  • World stocks of palm oil are expected to decrease towards the end of the fourth quarter due to high biodiesel needs, mainly from Indonesia, and lower production after the peak period, driven by cuts in fertilisers and the drought in Indonesia.

  • To date, SIPEF has sold 88% of its palm oil production for 2019 at USD 571 per tonne CIF Rotterdam, premiums included.

  • Due to the exceptionally lower than expected production volumes for the fourth quarter, especially in Papua New Guinea, the recurring results for the second semester will not be better than those of the first semester, and SIPEF will close the financial year with a loss.

  • The investment programs, related to the expansion in South Sumatra in Indonesia, have continued steadily, with 11 695 hectares already cultivated in Musi Rawas, while the replanting on Dendymarker's own plantations was continued.

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