IOI Corp, Malaysia’s No 2 planter, said today that the worst was over for the plantation sector as palm oil prices have recovered from last year’s slump although M&A activity would be muted.
“It’s quite obvious it will be better.
The industry including ourselves expect to see a much better fourth quarter (April-June) operating results,” IOI executive director Lee Yeow Chor told Reuters in an interview at the company’s headquarters.
Palm oil prices have now recovered more than 60 per cent from a low of RM1,331 (US$378.8) per tonne in October on surging Chinese and Indian demand as well as tight Malaysian palm oil stock levels in the first few months of 2009.
IOI, valued at US$8.37 billion, saw net profit nearly wiped out during the January-March quarter due to weaker crude palm oil prices and sizeable foreign translation losses on its US
Lee said the company expects losses seen in the fiscal third quarter to reverse in its upcoming quarterly results.
“For fourth quarter, with the weakening of the US dollar, from end-March of around RM3.63, we expect to have some gains in currency translation for our US dollar borrowings,” he said. — Reuters
Source : Business Times