nur nadia kamil – OPIEJ https://opiej.mpob.gov.my Oil Palm Industry Economic Journal Thu, 21 Mar 2019 01:39:37 +0000 en-US hourly 1 https://wordpress.org/?v=7.0 Managing Exchange Rate Risk: Practices of Malaysian Exporters of Palm Products https://opiej.mpob.gov.my/managing-exchange-rate-risk-practices-of-malaysian-exporters-of-palm-products/ Wed, 29 Aug 2018 00:37:56 +0000 https://opiej.mpob.gov.my/?p=414 Read more]]> This paper investigates the practices of Malaysian exporters of palm products in managing their exposure towards fluctuations in exchange rates and the level of awareness towards this exposure. The study was conducted on the 261 companies that were registered with the Malaysian Palm Oil Board for exporting palm products. Data related to exchange rate risk exposure and the risk mitigation strategies were collected by distributing a survey form via e-mail and facsimile as well as through random telephone interviews. The results show that the Malaysian exporters of palm products are commendably aware on their exposure towards exchange rate risk. However, not all of them manage their exchange rate risk by using the available hedging instruments. The Malaysian exporters of palm products are found to favour the use of forward contracts over the options contracts to minimise their risk.

Keywords: exchange rate risk, risk mitigation, forward contract, palm products

]]> An Analysis of Malaysian Palm Oil Exports to Selected TPPA Member Countries https://opiej.mpob.gov.my/an-analysis-of-malaysian-palm-oil-exports-to-selected-tppa-member-countries/ Wed, 29 Aug 2018 00:29:03 +0000 https://opiej.mpob.gov.my/?p=400 Read more]]> Malaysia officially signed the Trans-Pacific Partnership Agreement (TPPA) in February 2016. The trade partnership between Malaysia and 11 other participating countries is expected to enlarge Malaysian trade volume and consequently help the country leap-frog towards becoming a high income nation. A study to assess the potential economic impact of TPPA on the Malaysian economy has been done, but none on an in-depth empirical analysis of its impact on the Malaysian palm oil industry. This ex-ante study shows that the Malaysian palm oil industry will gain via TPPA. The elimination or reduction of trade barriers offered under TPPA will allow Malaysia to expand her palm oil market share internationally. The largest export increment due to TPPA was found in the study to be in the palm oil exports to Mexico, followed by Canada. However, no significant change was found in the exports of palm oil to Peru and the United States of America as both countries have currently imposed zero import duties on processed palm oil from Malaysia.

Keywords: TPPA, economic impact, Malaysian palm oil

]]> Climate Variability and its Impact on the Palm Oil Industry https://opiej.mpob.gov.my/climate-variability-and-its-impact-on-the-palm-oil-industry/ Wed, 29 Aug 2018 00:14:35 +0000 https://opiej.mpob.gov.my/?p=375 Read more]]> Located between the Indian and Pacific Oceans, Malaysia is exposed to changes in climate variability, namely, the El Niño and La Niña phenomena. These two complex weather patterns result from variations in the ocean temperatures of the equatorial Pacific. The occurrence of the so-called El Niño-Southern Oscillation (ENSO) event has a notable impact on the amount of rainfall in Malaysia. However, the magnitude of the impact depends on the intensity of the event. Additionally, the occurrence of the ENSO event also influences the production of crude palm oil (CPO) as rainfall is one of the key requirements for oil palm cultivation. This article describes the development of the ENSO event and analyses its impact on the palm oil industry in Malaysia.

Keywords: El Nino, La Nina, ENSO, FFB yield, crude palm oil

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