20 Sep 2007
Four biodiesel plants, including Global Bio-diesel Sdn Bhd in Sabah, were expected to start up by the end of this year but are now hesitating, said Michael Dosim Lunjew, Secretary General of the ministry of plantation industries and commodities.
Plants would have to see if record crude oil prices this week of over $82 a barrel are here to stay, Lunjew said. "Even $80 is tough unless it brings to higher levels."
Lunjew was taking part in a forestry conference in
"They need a margin, unless they are integrated which means they can take a loss, but most of the plants are independent."
Crude palm oil futures <0#KPO:> in Kuala Lumpur hit a record high this year and are up by 28 percent compared with the end of last year, and by 80 percent since the end of 2005, squeezing margins for plants counting on lower raw materials costs.
"Of course while the initial projections were very optimistic, with the recent price increase in CPO I think a lot of them are waiting to see what the next price change is going to be like," he told Reuters.
"If the price stays like this I think they will try to hold on for a while. The facilities are progressing as scheduled, except that the decision to operate them depends on the price of the CPO."
High crude palm oil prices have encouraged Malaysian plantation owners to expand into
The limited land means
But
About half of
Source: beta.malaysia.news
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