Latest market news

Malaysia legalisation drive to boost palm oil workforce

  • Market: Agriculture, Biofuels, Fertilizers
  • 12/11/20

Malaysia's plantation industry can start to employ undocumented migrant workers already in the country once the government moves to legalise their status from 16 November, according to home affairs minister Hamzah Zainudin.

Many producers agree the proposal may ease the labour shortage likely to have suppressed palm oil output since the government froze overseas hiring in June. But the programme may have limited impact on the palm oil industry as many targeted migrants are already working illegally in the plantation sector, said the secretary of Malaysia's estate owners' association Kam Sang Kok.

The World Bank estimated between 1.23mn-1.46mn undocumented migrants worked in Malaysia in 2017 without assessing the breakdown by sector. Documented foreigners make up 80-85pc of the plantation workforce, or 265,000 people, according to data from the Malaysian palm oil board.

The government aims to help sectors that are struggling to attract local employees amid restrictions to combat Covid-19 with its "undocumented migrant recalibration plan", Zainudin said. The proposal should also generate around 95mn ringgit ($23mn) in government revenue, he added.

Malaysia's immigration and labour departments will jointly run the programme until 30 June next year, which will allow employers in the plantation, agriculture, construction and manufacturing sectors to hire previously undocumented workers, under certain yet unspecified conditions.


Sharelinkedin-sharetwitter-sharefacebook-shareemail-share

Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

News
14/11/24

Advanced Fame ARA marine biodiesel blends hit 2024 lows

Advanced Fame ARA marine biodiesel blends hit 2024 lows

London, 14 November (Argus) — Marine biodiesel blends comprising Advanced Fatty acid methyl ester (Fame) 0 hit their lowest prices so far this year on 13 November, according to Argus assessments. Calculated B30 Advanced Fame 0 dob ARA prices fell by $15.05/t to $654.79/t, the lowest since 14 December 2023. Calculated B100 Advanced Fame 0 dob ARA values tumbled by $70.60/t to $922.79/t, their lowest since 29 December 2023. The calculated dob ARA range prices incorporate a deduction for HBE-Gs. These are a class of Dutch renewable fuels units, or HBEs, used by companies that bring liquid or gaseous fossil fuels into general circulation and are obligated to pay excise duty/energy tax on fuels. The sharp drop in blend values came despite firming prices in Advanced Fame 0 fob ARA range values, which rose by $11.50/t to $1,481.25/t on 13 November — their highest since 8 July. Fossil markets also rebounded from recent drops that day, with front-month Ice Brent crude futures and gasoil futures contracts edging higher by 16:30 BST. Market participants had pointed to sluggish demand for European marine biodiesel blends in recent sessions, which may have added pressure on Advanced Fame 0 blend prices. HBE-G values have soared, weighing on the blend values for which it is accounted as a deduction. Prices for 2024 HBE-Gs had almost doubled on the month at €18.75-18.95/GJ by 13 November, up from €9.70-9.90/GJ four weeks prior. Market participants attributed the increase in 2024 prices to recent gains in European hydrotreated vegetable oil (HVO) prices, tight supply because of a decline in tickets from biofuels used in shipping and less overall biofuel blending in the fourth quarter. HBE-Gs surpassed the like-for-like cost physical blending of HVO class IV by 13 November, albeit marginally, which could encourage physical blending. But high demand in a tightly supplied market in the Netherlands is continuing to drive HVO prices higher. The supply tightness is the result of a combination of fewer imports, with provisional anti-dumping duties in place on Chinese volumes, and some production problems. Italy's Eni confirmed on 7 November that it has halted output at its Gela HVO unit on Sicily, for planned maintenance. Finnish producer Neste said it stopped production at its plant in Rotterdam because of a fire on 8 November. France's TotalEnergies said that the shutdown of unspecified units at its La Mede plant would result in flaring on 8 November. By Hussein Al-Khalisy and Evelina Lungu Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Find out more
News

LAT Nitrogen halts sales to Germany on high gas costs


14/11/24
News
14/11/24

LAT Nitrogen halts sales to Germany on high gas costs

London, 14 November (Argus) — Major European producer LAT Nitrogen has withdrawn from the German market today owing to a surge in gas costs. LAT Nitrogen produces nitrogen-based products for the fertilizer and industrial chemical markets. It sells CAN, ASN and NPK 15-15-15 to the German market. "We will closely monitor the development of gas prices before considering a return to the market," LAT Nitrogen market intelligence and demand planning analyst Harald Lindner said. Front-month natural gas prices on the Dutch TTF have climbed steadily over the past two months, reaching more than €45/MWh today, up by €10/MWh from September. CAN is a key nitrogen fertilizer used in the German market and spot prices have stagnated at about €280/t bulk cif inland and have failed to grow ahead of the season, despite higher list prices. Yara raised its CAN asking price on 16 October to €305/t bulk cif inland for delivery to Germany and the Benelux countries, up from its previous offer of €295/t bulk cif inland. Buying interest from farmers has been incredibly slow ahead of spring applications this year. Market coverage in Germany for nitrogen fertilizers for the 2024-25 fertilizer year is estimated to be 40-45pc, down from an average of 60-65pc by mid-November. Weak grain prices, reduced farm incomes and warehouses full of unsold agricultural produce are also said to be behind the lack of demand for fertilizers from consumers. Some wholesalers are expecting sales to remain slow until the start of 2025, which will give distributors logistical challenges to deliver product ahead of early spring applications. LAT Nitrogen began maintenance in mid-September on some of the lines at its Linz site in Austria, affecting downstream fertilizer output of ammonia, nitric acid, CAN and NPKs. This was due to be finished by early November. The Linz site is a major source of fertilizers for central and eastern Europe, with CAN 27 annual production roughly at or above 600,000t in typical recent years, according to latest IFA data. The 429,000 t/yr prilled urea plant at Linz was unaffected by the maintenance and is running as normal. By Suzie Skipper Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

European urea market braces for CBAM impact in 2026


14/11/24
News
14/11/24

European urea market braces for CBAM impact in 2026

London, 14 November (Argus) — European producers and traders of urea are preparing for the phase-in of the EU's Carbon Border Adjustment Mechanism (CBAM) in early 2026. While EU producers expect their market share to rise, questions about the implementation, pricing, and oversight remain, leading to uncertainty among agricultural urea traders. The European AdBlue market is also weighing the possible impact. Under CBAM, which was passed by the EU in May 2023, urea importers will have to buy certificates to cover the carbon emitted during production wherever the plant is located. In the UK, the government confirmed its CBAM application on fertilizers and other commodities from 1 January 2027. CBAM is aimed at creating a level playing field for imports to the EU and the UK, while nudging non-EU countries towards climate action. European producers of urea currently have to contend with lower margins because their production cost is higher than that of non-EU manufacturers since the introduction of the EU Emissions Trading System (EU ETS). European producers are therefore at a disadvantage. The transition period in the EU for CBAM began on 31 October and will last until 31 January 2026. During this time, urea importers must provide quarterly reports on their imports and the carbon emitted during production. In February 2026, the phase-in for CBAM will begin. After that point, importers must buy enough CBAM certificates to cover at least 80pc of embedded carbon each quarter. Urea imports will therefore become more expensive in 2026. The exact increase in fertilizer prices, including urea, will depend on the cost of CBAM certificates, which in turn will be based on the weekly average price for EU ETS allowances. EU ETS certificates are currently priced at €66/t CO2 but are due to rise in the future. Calculating an exact price for CBAM certificates is difficult, Argus was told by affected parties. But estimates range anywhere from average indications of €10-20/t or even up to €80-100/t for imported urea. Higher prices will inevitably be passed on to the end-user. However, if one assumes that CBAM will add €10-20/t on the price of agricultural grade urea, then the estimates suggest that the cost of a loaf of bread will rise by €0.10-0.50, which is negligible, a European fertilizer wholesaler suggested. Given the uncertainty of CBAM's effect on pricing, some suppliers are cautious about trading too far into the future. Agricultural buyers purchase product in advance of the key application seasons, but importers often attempt to time purchasing around dips in international prices. European producers welcome CBAM European urea producers have welcomed the introduction of CBAM. They have sold automotive grade urea (AGU) at a premium to imports for several years, and as a result, they have lost market share. Norwegian fertilizer producer Yara said in its third-quarter results that it plans to only progress projects with the highest returns and concrete potential margins, driven by firm regulatory changes like the EU ETS and CBAM. The ETS and CBAM policies are likely to lift urea prices in Europe , and this would trigger increased nitrate fertilizer and NPK margins for Yara, if upgraded from low-carbon ammonia, according to the producer. Some traders expect AGU imports to fall with the phase-in of CBAM, and domestic producers' market shares to increase again. However, the European market relies on imports for both agricultural and automotive grade urea so heavily that a lasting, significant drop in imports seems unlikely, analysts said. "Fertilizer import quantities, including agricultural grade urea, will not be negatively affected by CBAM as importers will absorb the new costs, as those that are subject to duties have done so previously," a German trader said. There is, for example, not nearly enough prilled or granular urea production in Europe to cover demand, making imports impossible to avoid. In 2023, the EU 27 imported just over 5mn t of urea from just the top three non-EU suppliers — Egypt, Algeria and Russia — with an additional 6.3mn t from both within the EU and outside. Urea imports in January-August 2024 were 7.2mn t, down by 8pc from 7.8mn t in the first eight months of 2023. During this period imports from Egypt, Russia and Algeria accounted for almost 51pc. Furthermore, European urea traders have expressed concerns that it may be difficult for authorities to check carbon emissions at plants outside the EU, and that potential loopholes could allow foreign product to enter the market at discounted rates. There are also questions surrounding how the EU will regulate issuing CBAM certificates. Importers will not have to buy CBAM certificates, for example, if the producer has already paid a carbon price in the country of origin. Impact on AGU and Europe's AdBlue market The European AdBlue market might also feel the effects of the CBAM. AdBlue is produced by mixing AGU with deionised water. While most AdBlue in Europe is produced by primary producers using domestic urea, there are an increasing number of so-called diluters, which import competitively priced urea, and then offer AdBlue at a discount. If the price gap between domestic and foreign urea is closed, diluters might be forced to increase their prices as well. AdBlue traders in Germany and the Netherlands suggest that a narrowing price gap between these secondary producers and primary ones could affect the former's market share. The market share has been growing steadily in the past few years. That growth might be halted or even partially reversed once CBAM comes into effect. According to Argus calculations, AGU consumption in Europe will continue to rise until 2027, in line with the projected growth in AdBlue demand ( see graph ). AGU imports, similarly, are expected to grow until 2029, peaking at about 85,000 t/yr. By Natalie Müller and Suzie Skipper Projected growth in Europe Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

Bangladesh’s BCIC issues phosrock buy-tender


14/11/24
News
14/11/24

Bangladesh’s BCIC issues phosrock buy-tender

London, 14 November (Argus) — Bangladeshi fertilizer producer and importer BCIC has issued a tender to buy 30,000t of phosphate rock of at least 70 BPL (32pc P2O5), closing on 31 December. BCIC wants the cargo to be shipped to Chattogram within 30 days from issuing the letter of credit. Bangladeshi demand has added support to phosphates in the east and helped to tighten availability. BCIC will also close tenders to buy phosphoric acid on 18 and 20 November, and 1 January. And Bangladesh's ministry of agriculture has reportedly awarded cargoes under its 10 November private-sector tender after getting offers for 94,000t of DAP ranging $692-697/t cfr and 30,000t of TSP at $573/t cfr. The awarded prices, volumes and origins have not yet emerged. The ministry will close another private-sector tender seeking 200,000t of DAP and TSP on 18 November. By Tom Hampson Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

California RD plant signals later start up


12/11/24
News
12/11/24

California RD plant signals later start up

New York, 12 November (Argus) — An long-delayed project to convert a Bakersfield, California, oil refinery to produce renewable diesel (RD) has been given another extension for start up. Global Clean Energy Holdings, working to open a 15,000 b/d RD refinery, and trading house Vitol agreed last week to adjust the terms of a supply and offtake deal singed in June. The initial agreement said that Vitol could exit the agreement if the refinery was not producing at least 5,000 b/d of renewable diesel by the end of October, but that deadline has now been moved to 15 December. Global Clean Energy told Argus last month that it still has "plans in place to complete the remaining work and start up the facility" despite recently cancelling an agreement with its principal contractor. Vitol, after an initial three-year term, can now request up to three one-year extensions of the contract, up from two in the initial deal. The agreement, which cleared the way for former business partner ExxonMobil to exit, stipulates that Vitol will be the exclusive supplier of feedstocks to the plant and exclusive marketer of all fuel and environmental attributes. The revised agreement also says that if Global Clean Energy modifies its credit agreement to allow for more than $330mn in debt financing, then the renewable fuels producer will have to pay Vitol an additional fee that increases as more funds are borrowed. Global Clean Energy declined to clarify whether it had already triggered the obligation to pay Vitol the excess fee, saying that it could not provide more information ahead of filing its quarterly investor report "in the near future." If the plant begins operations as planned, it will have to contend with a challenging investment environment for biorefineries given recently low environmental credit prices and uncertainty around how president-elect Donald Trump will enforce a new federal clean fuels tax credit. At the same time, California regulators agreed last week to update the state low-carbon fuel standard, including by setting stricter carbon intensity targets that start next year. The regulatory updates lifted the prices of credits used for program compliance, which are a crucial source of revenue for companies bringing lower-carbon fuels like renewable diesel into the state. By Cole Martin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Generic Hero Banner

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more