Archive for March 2011

Japan Palm Oil Consumption Unaffected By Quake

This is written by Dow Jones Newswires journalist Lim Shie-Lynn.

A leading exporter of palm oil-based products to Japan said Wednesday that the country’s consumption of the cooking oil remains steady for now, despite the devastating earthquake and tsunami on March 11, but demand could potentially increase in the longer term.

“Demand is still steady for now, although the short supply of electricity may prompt many Japanese companies to reduce production hours and disrupt supply chains,” Tsutomu Usui, chief executive of Intercontinental Specialty Fats Sdn Bhd told Dow Jones Newswires.

Looking beyond the potential near-term demand disruptions, however, palm oil may account for a larger share of Japan’s edible oil consumption due to an increasing appetite for food that is free of trans fats, Tsutomu said.

Japan’s dominant power supplier, Tokyo Electric Power Co, introduced rolling blackouts that may last until late April after it lost around 40% of its generating capacity. The March 11 disaster disabled cooling systems at its Fukushima Daiichi power plant, shutting the plants down and triggering a nuclear crisis.

ISF, 80%-owned by the Tokyo-listed Nisshin Oillio Group Ltd and 20%-owned by edible oil firm Lam Soon, is a major producer of premium specialty food fats and oils, exporting around 40,000 tons to Japan last year. The country is the sixth-largest market for Malaysian palm oil, buying close to 600,000 metric tons last year.

Japan consumes around 2.3 million-2.5 million tons of vegetable oils include soyoil, rapeseed oil and palm oil. “The future of palm oil is very bright (in Japan). It is still the cheapest oil available and the move by food manufacturers to remove trans fats will boost imports,” he said.

Seven & I Holdings Co, a major Japanese retail conglomerate, decided in December 2010 to stop selling food products containing trans fats “as much as possible and hoped to eliminate them altogether from the shelves,” Kyodo News reported, citing company sources. The group, which controls 7-Eleven convenience stores, Ito-Yokado supermarkets, Sogo and Seibu department stores, joined other major companies such as McDonald’s Holdings Co (Japan) Ltd to reduce offerings of food items containing trans fats.

The move came after Japan’s Consumer Affairs Agency (CAA) asked food manufacturers to voluntarily label the trans fat content of their product earlier this year. While CAA didn’t impose a ban on products with trans fats, Japanese food makers said trans fats labeling may be considered mandatory in the longer term.

Trans fats are created in liquid vegetable oils that have been undergone a chemical process called partial hydrogenation.

Palm oil, a key ingredient in consumer products ranging from instant noodles and cooking oils to margarine and ice cream, is an alternative to oils that have been treated to increase the shelf-life of food products, as it is naturally stable even at room temperatures. Palm oil is higher in the saturated fats is believed to contribute to various health problems than many rival vegetable oils, but trans fats have been found to pose far greater risks to consumers’ health.

Now that regulators and consumer agencies have started to publicize the risks, palm oil is gaining an advantage over rival oils that have been partially hydrogenated to improve stability.

Sinar Mas’ Rp 9 trillion investment

This was published in Jakarta Globe yesterday.

Indonesian palm oil giant Sinar Mas Agro Resources & Technology Tbk and its affiliated companies will invest Rp 9 trillion (US$1 billion) in the space of four to five years to develop its downstream businesses.

“This Rp 9 trillion in investment is likely to absorb around 20,000 workers, directly and indirectly,” company chairman Franky Widjaja said after an inauguration ceremony for a palm oil refinery in Marunda, West Java, on Wednesday.

Sinar Mas Agro Resources & Technology is a division of Sinar Mas Group.

The Marunda refinery is worth Rp 2.3 trillion and is part of the company’s Rp 9 trillion commitment. It has a processing capacity of 300,000 tons of crude palm oil (CPO) per year and is set to produce 168,000 tons of cooking oil and 112,000 tons of margarine. Facilities in the refinery will, later, be expanded to enable it to produce 140,000 tons of cocoa butter substitute annually.

Widjaja said similar refineries would be built in Surabaya, Tarjun in South Kalimantan and Belawan in North Sumatra. “This effort is in line with the government’s policy to boost investment in the manufacturing sector,” he said.

Coordinating Minister for the Economy Hatta Rajasa, Industry Minister MS Hidayat, Trade Minister Mari Elka Pangestu, Chief Coordinating Minister Gita Wirjawan and West Java Vice Governor Dede Yusuf attended the the inauguration ceremony.

Rising commodity prices and efforts to boost the nation’s commodity processing sector have seen more companies pouring money into palm oil products, even though the industry faces challenges from environment activists, land acquisition issues and a complex bureaucracy.

Other food companies, including Nestle and palm oil giant Wilmar, have expressed their commitments to spend more money in Indonesia, the world’s largest producer of palm oil.

Bumper harvest for Sarawak Oil Palms

Sarawak Oil Palms Bhd (SOPB) is poised to see at least 10 per cent growth in its fresh fruit bunch harvest to 700,000 tonnes by the end of the year, as more young trees mature.

Headquartered in Miri, the group has planted close to 60,000ha with oil palms in Sarawak. In a recent interview in Kuala Lumpur, SOPB group financial controller Eric Kiu Kwong Seng spoke of the company's favourable tree profile.

"Last year, about 17 per cent of our planted area was of prime fruit bearing ages. As more young trees mature, we expect very good harvest prospects," he told Business Times.

"By the end of this year, about a fifth of our total planted area will be of matured ages and bearing more fruit bunches," he said.

Kiu is optimistic of good crop output because for the past few years the group had been consistent in its fertiliser use. "We never stinge on fertiliser despite the 10 per cent rise in cost. For this year, we managed to lock in 60 per cent of our fertiliser needs late last year," he added.

In 2010, SOPB's average fresh fruit bunch yield was 20.4 tonnes/ha. About two thirds of its oil palms are planted on peat soil. Kiu attributed the oil palms' high productivity to vigilant water management.

Also, SOPB's aggressive plantings as early as 2007 have resulted in 45 per cent of its planted area consisting of young oil palms and primed to bear more fruit bunches. This means big earnings growth potential in the next five years. So far, SOPB has planted 80 per cent of its 72,653ha landbank.

For the next two years, SOPB is spending some RM600 million on new plantings, construction of Sabaju and Tinbarap mills and a 450,000 tonne-a-year refinery.

SOPB was set up in 1968 via a joint venture between Commonwealth Development Corp (CDC) and the Sarawak state government. In 1995, conglomerate Shin Yang Group bought CDC's entire stake and is now the largest shareholder with 36.5 per cent while state-owned Pelita Holdings Sdn Bhd holds 28.9 per cent.

SOPB has a solid balance sheet. It had a net gearing of 50 per cent in 2003 but is now in a net cash position of RM52 million or 12 sen a share.

Although it does not have a dividend policy, the group has been paying out 3 sen a share.

Earlier this month, research house INet Research placed a "buy" call on SOPB's shares after having noted the group's strong balance sheet. It highlighted that SOPB's price earnings valuation of 8.2 times for 2011 is below the 15 times in plantation sector.

INet Research reckons that SOPB's share price can rise as high as RM4.30 based on a price-to-earnings ratio of 10 times of its profit forecast for this year.

Separately, OSK Research said since three quarters of SOPB's oil palms are younger than 10 years old, its fresh fruit bunches output could double in five years. OSK placed a "buy" call on SOPB's shares and maintained its valuation of the shares rising to as high as RM5.22. This forecast is based on a multiple of 12 times its forecast results.

The shares traded unchanged on Bursa Malaysia last Friday to close at RM3.46.

Japanese spirit hailed

Companies from the oil palm industry lend a helping hand. This is written by my colleague P. Chandra Sagaran.

IPOH: The Japanese people's graceful way of facing up to their most recent adversity has won the praises of Raja Muda of Perak Raja Dr Nazrin Shah.

Raja Nazrin said their patience and perseverance in enduring the hardship brought on by the March 11 earthquake and tsunami was admirable and inspiring. He said the world was now looking east once again but, this time, it was not at Japan's development and technological expertise but at the heart and soul of her people.

"In the face of great catastrophe, Japan in no less an inspiration to the world. The Japanese people have shown that man can only conquer his basic survival instinct for the greater good of society.

"They have displayed the fortitude, the composure, the dignity and the generosity that have so defined their culture," he said at the handing over of donations to the NSTP-Media Prima Disaster Fund here yesterday.

Raja Nazrin said the world had seen how the Japanese people in the affected areas did not hesitate to help others even though their own homes were destroyed and their belongings washed away.

"Able-bodied men and women carried supplies to victims and gave up their own food rations to feed families with children and elderly members. Although there were 500,000 evacuees, there was no rushing, no rioting and no clamouring for food, water and fuel.

"The calmness of those waiting in kilometre-long lines to receive good, water and fuel defied the temper and fury of the quake that shook the ground. Their warmth towards each other defied the freezing weather they had to endure."

Raja Nazrin also conveyed the sympathy of Sultan Perak Sultan Azlan Shah and Raja Permaisuri Tuanku Bainun to Emperor Akihito and Empress Michiko, and the people of Japan.

Also present were Raja Puan Besar Perak Tuanku Zara Salim, Perak Menteri Besar Datuk Seri Dr Zambry Abd Kadir, The New Straits Times Press (M) Bhd chairman Tan Sri Mohamed Jawhar Hassan and Consul-General of Japan Tetsuro Kai, who represented the Japanese ambassador.

Raja Nazrin later handed RM687,000 donated by various parties to Jawhar on behalf of the fund.

The donors included the Perak government (RM100,000), Sultan Azlan Foundation (RM100,000), Sunway City Bhd (RM100,000) and Kuala Lumpur Kepong Bhd (RM100,000), while Umno Perak contributed RM50,000, Perak Turf Club (RM50,000) and a personal donation of RM50,000 from TSH Resources Bhd chairman Datuk Kelvin Tan Aik Pen.

Other donors comprised companies, non-governmental organisations, political parties, government agencies and Ipoh International School.

Sarawak open to independent inspection

This was published in SARAWAK REPORTS, a week ago.

Kuching, March 22, 2011The Chief Minister of Sarawak has announced plans to invite independent and international inspection teams to visit Sarawak in order to verify and document the fact that more than 70% of the State’s rain forests remain intact.

In a clear response to British and other international environmental critics who have alleged in recent weeks that logging in Sarawak has led to massive deforestation of the rain forests, Abdul Taib Mahmud said that state officials would provide full cooperation and assistance to inspectors from any certified international industry or environmental organization that wished “to make a serious study.”

“I know that there are exaggerated claims that 90% of Sarawak’s forests have been destroyed by logging,” the chief minister said in an interview here in Kuching, the capital of the state of Sarawak. “These are probably claims by people who are well meaning and care for the issue of deforestation just like I do. But the fact is more than 70% of our forest are still intact.”

The Chief Minister noted that in addition to the 70% of primary rain forest which remains intact in Sarawak, “another 14% of our secondary jungle has been replanted and is undergoing plans for replanting. This is the simple fact and if people want to verify it, then they are welcome to come to Sarawak.”

In recent weeks, the sister-in-law of former British Prime Minister Gordon Brown has teamed up with opposition critics in Malaysia to make a series of harsh accusations against Sarawak and against the Chief Minister himself.

At the heart of this campaign in the British online and print media, launched by Clare Rewcastle Brown, has been the repeated claim, based on reports by an environmental NGO, that logging in Sarawak will have wiped out 90% of all rain forests by 2020. Gordon Brown himself endorsed these claims in a recent article in The Independent.

The Chief Minister’s interview with marks the first time he has spoken out on the allegations being made by Gordon Brown’s sister-in-law, who together with the former British prime minister, was herself at the centre of a British scandal over the abuse of personal expense claims in 2009.

The Chief Minister, in this interview, chose to focus on the issue of sustainable development in Sarawak and to answering the claims of deforestation being made in London and elsewhere.

“People can make many claims, but my government has been very deeply committed to sustainable management of our forest,” he explained.

The Chief Minister also spoke out against illegal logging.

“The truth is that we in Sarawak are committed to practicing sustainable management of our forests. In our traditional forest we practice what is called ‘fill-in planting’…. where there is a bald area, where we see this we plant trees.”

“On top of that we want to make sure that the timber industry will not be touching the traditional trees by illegal logging,” the Chief Minister added. “So we have converted some areas to be planted with quick growing species and the timber industries which are still expanding must also add to the greenness of our forest. I would expect that one million hectares can be planted within the next ten years.”

In announcing plans to invite independent inspection by qualified experts, the Chief Minister said his government and forestry officials would provide full cooperation. At the end of the day, he explained during the half hour interview, he was interested in seeing the truth documented to avoid misunderstanding and distortions.

“I have the greatest respect for the people of Britain or anywhere else in the world who care about the issue of deforestation, as I myself do,” he noted. “And because of that I’m ready and willing to open up the country for independent and international inspection. They will see that we still have much more rain forest than people give us credit for, to be preserved for the next generations.”

The Chief Minister also noted that there had been allegations about the extent of poverty in Sarawak, and it was time to set the record straight here too.

“When I took over in 1981, the rate of poverty was close to 40%,” he recalled. “We have worked hard on this top priority over the years and got some results which encourage me by 1985 it went down to 32%. And now the rate of poverty is 5.3%.”

When asked his opinion on why a few critics in London, cheered on by opposition politicians in Malaysia, have been gunning for Sarawak on the logging issue, and whether this might be related to the fact that the State Assembly is being dissolved and elections are being called here, the Chief Minister declined to speculate on the motivations, and repeated his announcement of Sarawak being open to international inspectors.

“The truth,” he said, “is that we have nothing to hide.”

Clean up your own mess first

This is written by celebrated journalist and activist Shamsul Akmar.

While this is his personal opinion, many in the oil palm and tropical timber industry share the same view. This is important to Malaysia's economy especially when the government is currently negotiating free trade agreements with Europe and the US.

IN September 2005, Bruce Cleghorn, then British High Commissioner and a few other Western diplomats committed an undiplomatic act, walking out of a conference hall in protest against what Tun Dr Mahathir Mohamad had said in his speech.

Dr Mahathir's remarks that Cleghorn and his cohorts took offence to, leading them to behave like rednecks, were in essence saying that the military action on Iraq by the United States-British led coalition of the willing was that of terrorists.

In short, Dr Mahathir, known for calling a spade a spade, stated the obvious -- the US-British invasion of Iraq was an act of state terrorism.

This column is not planning to discuss whether Dr Mahathir's remarks were justified or to further condemn Cleghorn's uncouth behaviour. It is to discuss the uncouth, condescending and arrogant behaviour of some Western leaders and self-appointed crusaders when dealing with the East. Of course, the East is not bereft of such individuals but their behaviour stems from bad and deprived upbringing.

The same cannot be said of the Western leaders and crusaders given the fact that they hold high and powerful positions, meaning they would have been well brought up. That being the case, it can only be concluded that their uncouth nature when dealing with the people from the East stems from their sense of superiority, topped with a condescending attitude towards a people that at one point in history was colonised and considered less human.

Hence, the presence of the likes of Cleghorn, former US ambassador to Malaysia John Malott, former US vice-president Al Gore and Clare Rewcastle Brown, who is the sister-in-law of former British prime minister Gordon Brown.

If Cleghorn got upset when it was pointed out that Britain and the US were and still are involved in terrorising Iraq, the others took the moral high ground to judge and condemn Malaysian leaders for not behaving the way they had scripted.

While the issue of Malott and Gore had been extensively discussed, the latest addition is Clare, a former BBC journalist now on a self-appointed crusade "to protect the well-being of Sarawak", a former British colony.

Brown, the failed prime minister of Britain, threw in his support for Clare, by alleging the Sarawak government of excessive logging and  oil palm planting, to the extent that only five per cent of the primary forest in the state is left. These accusations of deforestation of such magnitude had been denied and explained by the Sarawak authorities who threw a challenge to the Browns to "come and look for yourself".

While there would be as many supporters and detractors of the accusations against Sarawak Chief Minister Tan Sri Abdul Taib Mahmud and the Sarawak Barisan Nasional, what is more incredulous is the ease in which the likes of Clare and Brown can raise a stink about a far-off country when the stench emanating from their own backyard stench is more putrid by comparison. It is not a case of two wrongs making one right.

Here is a situation where there is still a debate as to the accusations of wrongdoings in Sarawak while the bigger crime in Britain, which has been proven, is ignored by crusaders like Clare and Brown.

If they were so concerned about the environment, surely Clare being the "investigative" journalist that she claim she is, would have been able to highlight the depleted uranium in Iraq that is causing unthinkable horrors.

Surely Clare would be embarrassed to have the support of a brother-in-law who was a senior member of the Tony Blair administration that lied to the British people and dragged the nation into joining the Iraq invasion. How are Malaysians to believe what Brown had said and by extension, Clare's cause, when he is known to be a partner to Blair in war crimes?

Indeed, some may argue that it is not who said it that should be the debate but rather what is said. But if the one who said it is known to have supported and spread lies that led to the deaths of thousands, surely what has been said needs to be taken with a pinch of salt.

Taib will face the people of Sarawak if he is guilty of what he is accused of. But to have the likes of Clare and Brown parlance on the moral high horse and judge him or BN is indeed nauseating.

Clare may or may not be a liar but Brown, someone proven to be prepared to support a liar, supports her. Brown had helped Blair make a mess of Iraq. Should anyone not be suspicious that he may be supporting Clare to mess up Sarawak?

What the Browns need to do to gain some credibility is to clean up their own mess and expose the war crimes of the Blair administration that led to the murders of the thousands of innocents in Iraq as well as the environmental disaster.

That done, the Browns should start apologising to Sarawakians and Malaysians for the crimes committed by the British government and the White Rajahs against their former colony. Maybe, they can help return what their forefathers had robbed and plundered.

Made with love and kindness

A STRIKING figure in navy blue and beige walks towards me. She flashes a friendly smile and extends a handshake. "Hi! I'm Sandra."

Her friendly welcome sets the tone of the interview with Business Times in Ipoh, Perak.

Born and bred in Singapore, Puan Sri Datuk Sandra Lee, the chief executive officer and brand guardian of Crabtree & Evelyn Ltd, has made Ipoh, where her husband resides, her home for three decades.

She said Crabtree & Evelyn, owned by Ipoh-based Kuala Lumpur Kepong Bhd (KLK) since 1996, is very much a global company. This is because the creative process and product development is still being carried out in London while the laboratories in the US churn out the formulations.

Asked if she frequently flies out to meet her team, she replied, "Yes, every month for a week or two."

As the conversation progresses, it becomes evident that the old adage of "Do unto others what you want others to do unto you" applies to business, too.

In gaining loyalty, she gives loyalty. In motivating her staff, she is inspired by their initiatives. In encouraging hard work from her colleagues, she works relentlessly for them.

Their dedication is reflected in the company's posting US$8.4 million (RM25.6 millon) pre-tax profit for the year ended September 2010.

The company first sold products under the Crabtree & Evelyn brandname in 1972 and its first retail store opened in 1977. The store's name is derived from a short form of Crabapple Tree and the last name of John Evelyn, an Englishman who wrote about conservation. Evelyn's personal motto was "Explore everything. Keep the best."

On branding, Sandra explained that the enduring English Crabapple tree symbol is regarded the ancestor of all cultivated trees and exudes home apothecary.

Her eyes sparkle as she elaborates Crabtree & Evelyn's mantra for natural ingredients. "All of our products are extracted from fruits, flowers, plant and herbal essences," she said.

Crabtree & Evelyn's bestsellers are its Iris, Lily, Lavender and Rosewater bodycare ranges. Other fast-moving items include its award-winning hand therapy, body lotions and creams, shower gels and eau de toilettes and parfums.

Sandra says that Crabtree & Evelyn is not just for the ladies.

With men in mind, the group produce the Naturals and Nomad range of shaving creams and balms. These help to ease skin irritation from shaving. Asked if her husband Tan Sri Lee Oi Hian uses any of the products, Sandra exclaimed, "Why, of course, he's our biggest fan!"

"Our top-selling hand therapy products range contains the active ingredient tocotrienols," she said. Extracted from palm oil, tocotrienols are part of the vitamin E family. It includes tocopherols.

Sandra explained that regular vitamin E-enriched moisturisers, which have yet to incorporate tocotrienols, are not that effective in protecting the skin from the sunlight's ultraviolet (UV) radiation.

"Currently, what most face creams, body butters and moisturisers in the market offer is tocopheryl acetate, a derivative of common vitamin E tocopherols. There is not much benefit. The only advantage is tocopherols being a preservative for the product, increases the shelf life while allowing a claim that it contains vitamin E," she added.

Sandra foresees that many more skincare companies will soon start to incorporate palm tocotrienols in their formulations, even though they cost up to 10 times more than tocopherols. This is because research has proven that tocotrienols are 60 times more effective than tocopherols at protecting the skin from the damaging effects of over-exposure to UV sunrays, pollution, stress and smoking.

Tocotrienols have also been shown to be effective against excessive skin pigmentation and has anti-melanoma properties.

Sandra's enthusiasm picks up further as she touches on the expansion plans of Crabtree & Evelyn, which now has 452 outlets all over the world. "Half of our outlets are in Asia and the other half, in western countries. There's tremendous growth opportunities in China, India and Indonesia. We're actively seeking local partners to penetrate these huge markets," she said.

Crabtree & Evelyn has been supplying its La Source bath amenities to Hilton Worldwide for the past three years.

As the contract expires this month, a new contract kicks off with other Hilton family brands, namely; DoubleTree and Embassy Suites.

The La Source toiletries are also on board flights of Malaysia Airlines and Cathay Pacific. "We've put in our bids to supply to other hotel chains and airlines," she said.

A natural marketeer, Sandra clearly knows how to accentuate the positive. She brings the same skills she uses in everyday life to social media. Apart from its official website, Crabtree & Evelyn is present in Facebook, blogs, Twitter, YouTube and other platforms.

Sandra and her team share, connect, support everyone in their circle. Their virtual community is growing by the day.

Well-liked by many church-going folks in Ipoh, Sandra is known for her big heart. For the past 19 years, as co-founder and executive chairperson of Daybreak Centre, Sandra supports vocational training for the physically-challenged to be self-reliant.

Daybreak - an acronym for Disabled Adults and Youths Being Rewarded, Encouraged and Awarded in Kinta - operates a retail outlet that promotes handicrafts lovingly made with care and kindness.

The Perak Sultan, in recognising Sandra's dedication to charity and the under-priviledged, accorded her a "Datuk" title. In spite of this royal acknowledgment, Sandra is not one who rests on her laurels. Long after her children have left school and started working, Sandra continues to be involved in philanthropy.

She is an active member of the board of governors of Sekolah Menengah Jenis Kebangsaan (SMJK) Sam Tet and SMJK Ave Maria where her four children schooled. Recently, she raised RM1.5 million and oversaw the addition of new facilities there.

Like most women, Sandra strives for a balanced work and family life. Of her four children, her younger son stays with her in Ipoh. Whenever Sandra is in Kuala Lumpur, Singapore or London, she makes time for her three other children. Since she always hold that goal in mind, she is unlikely to cave in to entrepreneurial burnout.

On parting words to budding women entrepreneurs, Sandra likened running a business to a marathon - pace yourself, see the big picture and take time to live life to the fullest.

Sweet beginnings for the lily

Crabtree & Evelyn’s brand guardian Datuk Sandra Lee has many reasons to be excited. She tells INTAN MAIZURA AHMAD KAMAL more during a very English affair at the Carcosa Seri Negara, Kuala Lumpur.

“I’M in love with Kate Middleton!” squeals Datuk Sandra Lee, brand guardian of Crabtree & Evelyn, surprising me somewhat, having been so regally composed for the most part of our chat.

“She has such amazing poise for a young lady. And I love her fantastic sense of style. Effortless chic!”

Looking stunning in a rich fuchsia Dior ensemble, with a strand of pearls around her neck, the bobbed-haired 50-something, who was at Carcosa Seri Negara for the recent launch of the brand’s new Floral Fragrance Collection, confides just how excited she is about the impending nuptial of Middleton and Prince William.

“In London, we’ve prepared a whole range of souvenirs for their wedding in anticipation of the millions of tourists who’ll be converging to the capital for the event.

"We’re using the CW (Catherine and William monogram), and the Royal Coat of Arms with the date 29 April, so that the effect is subtle and elegant,” she adds, beaming.

“They can take a momento home that reminds them of their visit during the royal wedding.”

On offer are a variety of the Heritage Crabtree soaps in various fragrances, which customers can choose from and have packed in a box with the bespoke royal logo of CW.

“The box carries our Heritage prints with icons from London or UK — the English Royal Guard, the Union Jack, Scotsmen, a cup of English tea and biscuits, and so on.”

The company has also designed a special commemorative tag, which has the royal logo, the April 29 date and the Crabtree logo.

“The idea is to offer items that are of high quality, beautiful, yet carry a commemorative tag that’s subtle, unlike those available in the tourist shops. The tag will be used on current favourite Crabtree items.”

Unfortunately, this range is available exclusively in the UK only.

Closer to home, the excitement doesn’t cease. The Singapore-born Lee, who moved to Malaysia three decades ago following her marriage to Kuala Lumpur Kepong Bhd (KLK)’s CEO, Tan Sri Lee Oi Hian, is flushed at the fact that the company, which has half of its 452 outlets in Asia, posted US$8.4 million (RM25.4 million) in pre-tax profits for the year end September 2010.

Last week, she launched the brand’s expanded range of soliflores (single note fragrances), the Floral Fragrance Collection, comprising Rosewater, Lavender and Lily. This follows last year’s encouraging debut of Iris.

The artfully crafted range is presented in elegant packaging featuring unique watercolour designs — a modern take on botanical illustrations inspired by the vibrancy found in nature.

For the home, the collection includes delicately-scented candles, diffusers, home fragrance sprays and scented lining paper for drawers printed with graceful watercolour illustrations.

“We redesigned the whole packaging and upgraded the formulation,” shares Lee, who used to work as a brand manager for several cosmetic companies and fashion labels.

“The brand is 40 years old, the original packaging was designed 40 years ago, so it was time to change. We need to evolve with the new trends in fashion, lifestyle and the needs of our new consumers.”

Despite that, Crabtree & Evelyn continues to remain true to its brand DNA. “We’ll never move away from the essence of the brand, which is rooted in the garden — the fruits and botanical flowers.”

To evolve and cater to new consumer needs is a brave move, concedes Lee. The company needed to ensure that it didn’t end up alienating its existing customers. A year was spent on research in the US, Canada, UK and Hong Kong, and focus groups were engaged.

“We showed both our old customers and potential new ones our new designs and from there we graduated to a big re-design exercise.”

Water colour was selected as it is part of the English heritage, adds Lee, who has a marketing background. “This medium is very light and fluid, and we believe that this would actually enhance the product line, which is all the single floral inspired by England. A young English girl fresh from the UK’s St Martin’s School of Design, whose forte was watercolour, was chosen to execute the idea.”

The scents, meanwhile, except for Rosewater, the brand’s No.1-selling fragrant, were reformulated to make them more current.

“Lavender has a twist of lemon added on so it’s very fresh, while Lily is completely refreshed with the addition of citrus leaves,” says Lee, whose favourite scent for the day is fresh lily. At night, she often opts for heavier fragrances such as Iris or Rose.

Lee, a mother to two boys and two girls, is passionate about nature. Her spacious garden in Ipoh where she resides with her family is her private haven and her labour of love.

“We developed it for more than 20 years, adding layers and layers to it.” She smiles. “We have palm trees and beautiful rainforest species in the bigger field. Nearer to the house, we have frangipani, bougainvillea and a lot of water features — there’s a pond and around it are various water plants.”

With such a hectic schedule (Lee spearheads the group’s management and operations team in the UK and US in new product development, works with several established global creative companies in the UK for its designs, accessories and gift programmes, and oversees the UK team in rolling out new store design concept to enhance shoppers’ experience), it’s no wonder that her most precious down time is spent in her garden.

“The break of dawn is my favourite time,” confides Lee, an active philanthropist. She’s the co-founder and executive chairperson of Persatuan Daybreak (acronym for Disabled Adults and Youth Being Rewarded, Encouraged and Accepted in Kinta), a vocational training centre for the physically-challenged to be self-reliant and independent.

“That’s when I have my quiet time sitting in the garden, reading, watching the dawn breaking. You should see the colours changing as the day progresses. Everyday is like a painting.”

As our session nears a close, I couldn’t help bringing this amiable lady back to the subject of Middleton, again. Which scent from the new collection would Lee choose for her favourite fashion icon?

The self-confessed Anglophile, who grew up in Singapore listening to the Beatles and Cliff Richard, and whose style icons were the lovely Twiggy and Jean Shrimpton, replies, eyes sparkling: “The lily of the valley of course. It’s fresh, young and spirited — just like her!”

The Lily is presently available in all Crabtree & Evelyn stores. Rosewater will follow next month and Lavender in May.

'EU not supporting NGOs against palm oil'

This is written by my colleague Rupa Damodaran.

THE European Union is not using environmental non-government organisations as a "fifth column" to help it achieve its Renewable Energy Directive (RED) which places palm oil for biofuel at a disadvantage, says Trade Commissioner Karel de Gucht.

"RED is a result of a legislative decision between the council and parliament. We're advancing sustainability in palm oil especially biofuel but it is not restricted to palm oil only.

"We're not supporting NGOs for doing that (attacking the palm oil industry) but we're also not restricting them. Of course, they try to influence what is happening in the European Parliament but they are entitled to do so on their own behalf," he said.

He was speaking in an interview with the Business Times during his two-day stopover in a visit to Malaysia, Australia, New Zealand and Papua New Guinea last week.

He was asked to comment on recent allegations and comments by government officials and think tanks and claims that the EU has been running afoul of the World Trade Organisation (WTO) guidelines. Many felt that Western edible oil producers were resorting to environmental NGOs since they cannot use trade protectionist measures.

He said he was not aware of a proposed joint action by both the Malaysian and Indonesian authorities to the WTO against the 27-member EU for the way it has formulated the RED as well as reports of it funding up to 70 per cent of the operating budgets of environmental NGOs.

The palm oil industries of both major producers, worth over US$50 billion (RM152 billion) annually, and commanding a 60 per cent market share of the world's 17 oils and fats market, are finding themselves hapless against this European strategy.

de Gucht did not want to respond to British Member of European Parliament Roger Helmer's allegation, saying it was the position and view of an individual MEP out of a total of 750. (Helmer claimed in Kuala Lumpur last month that the European Commission alone had provided more than euro60 million [RM356.8 million] to these pressure groups through a programme called LIFE+). Such funding implicates the EU for creating barriers to trade for agricultural products from developing countries.

We're not putting restrictions on the exports of palm oil to the European market - we're simply giving advantage to palm oil that is produced in a sustainable manner. "RED applies to biofuel and not other applications for palm oil in the food industry or cosmetics," he argued, adding that recent market trends showed that less palm oil was finding its way to biofuel.

For 2010, Malaysia and the EU conducted trade totalling RM122.8 billion, of which palm oil came in a far second to the exports after electrical and electronics (E&E), commanding a 7.6 per cent share of exports, totalling RM5.25 billion.

On the ongoing bilateral free trade agreement (FTA) talks between Malaysia and the EU, de Gucht said there will be a sustainability chapter which will address the import of palm oil into the region. The part on labour will be done with reference to the International Labour Organisation while the aspect on environment will be based on the environment conventions of the United Nations, he explained.

"The way it is implemented may vary from one FTA with another, and so it will be a subject of discussion between both countries."

Malaysia is also engaged with the EU on the FLEGT (Forest Law Enforcement, Governance and Trade) Voluntary Partnership Agreement for trade in timber products. "We're negotiating with Malaysia and we are confident that it will come into play in a short notice. The delay is on the Malaysian side, and we hope the government will be able to work it out."

Would environment play a stumbling block in furthering exports to the EU?

"We expect countries to respect our requirements. Malaysian companies are doing so. For example, fish exporters adopted a self-imposed ban to ensure that their long term reputation on the EU market remained intact." In the long run, trade between both the EU and Malaysia will be served by high environment standards, he added.

MPOB: Only 10 biodiesel plants operating

This is written by my colleague Presenna Nambiar.

THE government has issued 60 biodiesel manufacturing licences as at end-February 2011 but only less than one fifth has started production.

Biodiesel (B5) in Malaysia is a blend of 5 per cent palm methyl ester and regular diesel.

According to the Malaysian Palm Oil Board (MPOB) data, only 10 biodiesel plants were operating last year, despite some 29 biodiesel plants having been established with total production capacity of 3.37 million tonnes per year.

"These plants were operating on and off, with three or four plants operating each month, due to the lack of demand for biodiesel exports and high palm oil prices in the second half of 2010," MPOB director general Datuk Dr Choo Yuen May said in her keynote address at the BioWise 2011 conference in Kuala Lumpur yesterday.

BioWise 2011 is Asia Pacific's gathering of professionals from the sustainable fuel and biotechnology industry. The event ends tomorrow.

According to MPOB, last year's biodiesel exports fell more than 50 per cent in both quantity and earnings, from 2009. The biodiesel plants produced 117,173 tonnes of palm biodiesel, with only 89,609 tonnes exported, bringing in RM266.53 million in earnings for the year.

The country's biodiesel production will be more than enough to cater for the needs of the central region of Peninsular Malaysia, once the mandatory use of palm biodiesel (B5 programme) is implemented come June 2011.

Under the programme, all diesel pumps in four states - Selangor, Kuala Lumpur, Putrajaya, Negri Sembilan and Malacca - will be replaced with B5 pumps in stages, beginning June 2011. MPOB clarified that the four states will need only 100,000 tonnes of biodiesel per year to be implemented. This is about 20 per cent of the 500,000 tonnes per year of biodiesel required for nationwide implementation.

In a move to promote the usage of biodiesel, the government has committed to funding the price differential between diesel and biodiesel through Automatic Pricing Mechanism. It was reported that subsidies could run between 5 sen and 7 sen per litre.

There have been doubts on whether the government would continue with the implementation of the B5 programme come June 2011, due to the high price of crude palm oil.

Choo reiterated that the government will implement the B5 programme in the central region as planned, adding that all parties are working towards the implementation.

Timber stocks buck market trend

BURSA Malaysia closed flat yesterday as investors digested the full impact of Friday's earthquake and tsunami in Japan. Timber stocks, however, bucked the trend, while rubber and palm oil futures took a hit.

The benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) closed 0.27 point lower to 1,495.35 points yesterday.

Timber-related counters rose after RHB Research Institute Sdn Bhd said timber companies are likely to benefit from a surge in demand from Japan as the country rebuilds after last week's earthquake and tsunami. Ta Ann Holdings Bhd added 8 sen to RM4.84, Jaya Tiasa Holdings Bhd climbed 16 sen to RM5.01 and WTK Holdings Bhd rose 7 sen to RM1.33.

A fund manager from TA Investment Management Sdn Bhd said the rise in timber stocks was quite benign.

On the converse, futures prices of commodities such as rubber and palm oil were pressed down.

August delivery for rubber, the most active contract on Tokyo Commodity Exchange, plunged 5 per cent to 383.5 yen a kg before settling at 384.1 yen (RM14.19), triggering a circuit breaker that suspended trading on all contract months. Japan, one of the world's top rubber consumers, mainly imports its rubber supply from Southeast Asia.

Taking the cue from Japan, the Malaysian Rubber Board's SMR 20 plunged 74 sen to RM12.85 per kg, while latex-in-bulk dropped 33.5 sen to RM9.49 sen per kg.

Palm oil prices also declined on concerns that Japan, one of Malaysia's top five clients, is facing difficulties receiving cargo as some of its ports had been destroyed by the earthquake and tsunami. Yesterday, the third month benchmark palm oil futures on the Bursa Malaysia Derivatives Exchange dropped RM29 to RM3,335 per tonne.

One trader said the bulk of shipment had to be re-routed. Another trader said the aftershock of the earthquake and tsunami may worsen. This could lead to a situation that warrants a declaration of "force majeure" and trigger contract defaults.

Mercury Securities head of research Edmund Tham said there is no certainty on the extent of damage at Japan's seaports. "There are no real figures out yet although Japan's logistic sector is hit hard."

Investors may have sold off some of their shares here to take profit but Tham said there were no major selldowns. "I don't see any major concern. If anything, the FBM KLCI is likely to trade rangebound over the next few days," he added.

Tie-up drama takes the shine off palm meet

WHEN news reports of Indonesia Commodity and Derivatives Exchange (ICDX) possibly holding hands with CME Group were published, there were many red faces at the Palm and Lauric Oils Outlook Conference (POC) 2011.

Every year, the highlight of the POC series is on the palm oil price forecast. 

This time around, however, Bursa Malaysia Bhd got a rude shock when reports by Thomson Reuters, Dow Jones and the New Straits Times quoted ICDX managing director Megain Widjaja as saying he is excited over the prospects of cross border trades at his exchange, having forged a tie-up with CME Group.

In a bid to stem a snowball of inaccurate information from becoming an avalanche, CME Group managing director of agricultural commodities Tim Andriesen called an emergency press conference.

CME Group, which clocks in a daily trading volume of around nine million contracts, consists of the Chicago Mercantile Exchange, Chicago Board of Trade (CBOT), New York Mercantile Exchange (Nymex) and and Comex. It is the world's largest derivatives exchange for grains, livestock, oilseeds, dairy and timber.

Andriesen reaffirmed that "CME Group has deep respect for its existing partnership with Bursa Malaysia".

"Bursa Malaysia is our key and strategic partner in this region. It would be bad faith on our part if we were to offer any products where Bursa Malaysia is not involved," he added.

This is because in 2009, CME Group and Bursa Malaysia swapped shares to promote the trading of palm oil contracts.

This was followed up with CME Group launching its dollar-denominated contracts. Also, all existing Bursa Malaysia Derivatives products like FCPO, FUPO and FKLI were made available on the CME Globex.

It is understandable that many Bursa officials were upset with the slew of inaccurate news causing confusion among futures brokers in Malaysia. This is because Bursa had, for many years, been working hard to forge strategic partnerships with high-profiled exchanges in Chicago and Dalian. These partnerships are one of the many ways for Kuala Lumpur to retain its clout as the global benchmark in palm oil trade.

What this means is although palm oil is traded in other exchanges like Dalian, Jakarta, Mumbai and Chicago, international brokers and traders quote palm oil prices from Kuala Lumpur.

"Palm oil prices have been quoted out from Kuala Lumpur for the last 30 years. It is actually quite an achievement because tin and rubber, which used to be quoted from Kuala Lumpur also have long shifted to London and Tokyo," a market observer said.

The usual trend is for commodities to be quoted out from exchanges that have high clusters of end-users or from financial hubs like London, Singapore, Hong Kong and New York.

As it is, the Dalian Commodity Exchange (DCE) is now clearing 10 times more palm oil trades than Bursa Malaysia. So, it is only natural for Kuala Lumpur to collaborate with CME Group and DCE to stay on top of the game.

"Therefore, when there are rumours or news questioning the exclusivity of partnership with CME Group within the same region, it strikes at the heart of Bursa Malaysia," the market observer added.

Despite the controversy and confusion, Bursa had a reason to smile because POC 2011 recorded its best ever attendance. More than 2,000 delegates gathered in Kuala Lumpur this week and they paid conference fees averaging RM2,500 each, 20 per cent higher than last year.

When met at the gala dinner, Bursa Malaysia chief executive officer Datuk Yusli Mohamed said he was pleased with the successful delegate turnout. "Yes, this is my last do before my term ends. The POC series have attracted quite a big crowd this year," he said.

Last month, Bursa Malaysia named Datuk Tajuddin Atan, the current managing director of RHB Capital, as its new CEO effective April 1 2011. He takes over from Yusli, who has helmed the position for seven years.

At the gala dinner, Kenanga Deutsche Futures Sdn Bhd, a subsidiary of K&N Kenanga Holdings Bhd, emerged the best overall performer for the eighth straight year in attracting the biggest trades into Bursa Malaysia Derivatives Exchange. It also won the Top Equity Futures Broker Award 2010.

"We will continue to put our clients' needs at the forefront and implement innovative and cost-effective solutions," said Kenanga Deutsche Futures executive director Azila Aziz.

Crabtree & Evelyn plans more Asian outlets

CRABTREE & Evelyn Ltd has allocated up to US$5 million (RM15.15 million) to open up some 20 outlets in Asia this year.

Crabtree & Evelyn chief executive officer and brand guardian Puan Sri Datuk Sandra Lee expressed optimism that the global economy will continue to grow at sustained pace, having weathered a downturn two years ago.

"We see huge market potential for Crabtree & Evelyn in China, India and Indonesia. We want to leverage on these opportunities," Lee said in an interview with Business Times in Kuala Lumpur.

"We've set aside up to US$5 million in capital expenditure for new stores. Whether it will be 10 or 20 stores ... it really depends on us getting the right location and at the right (rental) rates," she added.

The multinational company, which has half of its 452 outlets in Asia, benefited from the robust economic growth in this part of the world. For the year ended September 2010, it posted US$8.4 million in pre-tax profits.

An innovative marketeer, Lee sporadically holds interactive events where guests and celebrities can sample Crabtree & Evelyn products in a luxury setting of the world's finest hotels like Kuala Lumpur's Carcosa Seri Negara.

Yesterday, Lee introduced Crabtree & Evelyn's expanded range of soliflores titled the Floral Fragrance Collection. They were Rosewater, Lavender and Lily, following last year's encouraging debut of Iris. These pampering accoutrement look refreshing in their new packaging. Uniquely painted with dainty dabs of watercolour flowers, the flacons make beautiful collectibles.

A pioneer in botanical formulations for over three decades, Crabtree & Evelyn is present in more than 40 countries, with over 6,000 locations and 450 outlets worldwide. Although it was founded in the US, Crabtree & Evelyn has always been distinctly English in its concept.

Owned by Kuala Lumpur Kepong Bhd since 1996, the management has stayed true to Crabtree & Evelyn's founding principles of holistic luxury goods made from natural ingredients.

Mixed views on palm oil prices

This is written by my colleague Zaidi Isham Ismail.

Palm oil industry experts have given conflicting views on where the commodity's price is headed for this year, due to volatile petroleum prices.

Some said the crude palm oil (CPO) prices may have reached its peak but others think prices could climb higher if the political unrest in North Africa and the Middle East worsens.

In what looked like a repeat of 2008, CPO and crude oil prices are hitting records so far this year. Worries about a supply shortage following troubles in Libya, which supplies 2 per cent of global oil needs, have pushed up crude oil prices. Brent crude is trading at around US$113 (RM342) a barrel currently.

High crude prices mean more demand for biofuel, and this, in turn, means better demand for CPO. On top of this, there is already strong demand for CPO in emerging markets like China and India as their big population consumes more food.

At the industry's leading global conference yesterday, London-based Godrej International director Dorab Mistry said CPO prices, now trading around RM3,500 a tonne, can hit RM4,000 this year due to the political instability in the Middle East.

"Biodiesel demand is expected to rise by at least 2.5 million tonnes this year due to the geopolitical uncertainty in Middle East and North Africa.

"If the strife and demonstrations continue for a period of months, energy prices will remain high and expand the demand for biodiesel," he said at the Palm and Lauric Oils Conference and Exhibition 2011 (POC 2011) in Kuala Lumpur yesterday.

Given the high energy prices, tight palm oil stocks and increasing demand, the CPO price is due to reach a new high in the next eight to 10 weeks. "It is conceivable that CPO prices may test RM4,000 in the next few weeks," he said. He reckons prices will not fall below RM3,000 a tonne this year unless there is a general financial meltdown and a market collapse.

But Hamburg-based ISTA Mielke GmBH executive director Thomas Mielke is not so optimistic as he thinks the crude oil market is too volatile. "CPO price of US$1,250 (RM3.787) a tonne is not sustainable due to the high volatility. But it will not go below the level seen in 2008," Mielke said in his paper at the same conference.

What is important now is how the industry should sort out re-plantings, yield improvements and acreage issues to retain world market leadership.

LMC International Ltd chairman Dr James Fry, meanwhile, said the global economy holds the key to the CPO price direction this year. Countries are expected to raise interest rates to deal with inflation and this will dampen economic growth.

"There are clear signs of a global economy overheating but CPO price has a relationship with petrol price. The impact on the local CPO price depends crucially on what happens to petroleum price." Fry forecasts the CPO price to rise to about RM4,300 a tonne but it can go as low as RM2,250 a tonne after spiking in the second quarter.

On production, Mistry said Malaysia's CPO output is expected to be 17.3 million tonnes this year, while Indonesia's would be 1.5 million tonnes higher than last year and hit 24 million tonnes.

Mielke, meanwhile, said Malaysia's palm oil production can touch 17.8 million tonnes in 2011 compared with 16.9 million tonnes in 2010, while that of Indonesia may touch 23.7 million tonnes in 2011 from 21.9 million tonnes in 2010.

CME denies tie-up with ICDX

Chicago-based CME Group, the world's largest and most diverse derivatives exchange, yesterday denied any direct engagement, collaboration or tie-up with the Indonesia Commodity & Derivatives Exchange (ICDX).

CME reaffirmed that it has "deep respect for its existing partnership with Bursa Malaysia".

"We refer to the news reports suggesting alliance of some sort between CME Group and ICDX and we would like to categorically state that we did not enter into any agreement with ICDX.

"The reports were inaccurate because we do not have any direct engagements or discussion with ICDX on any joint offerings of our products," CME Group managing director Timothy Andriesen said at a press conference held on the sidelines of the Palm and Lauric Oils Outlook Conference (POC) 2011 in Kuala Lumpur.

"Bursa Malaysia is our key and strategic partner in this region. It would be bad faith on our part if we were to offer any products where Bursa Malaysia is not involved," Andriesen added.

In 2009, CME Group and Bursa Malaysia swapped shares to promote the trading of palm oil contracts. The following year, the tie-up resulted in CME Group launching its dollar-denominated contract. There was also the listings of all existing Bursa Malaysia Derivatives products like FCPO, FUPO and FKLI on the CME Globex.

CME Group, which clocks in a daily trading volume of around nine million contracts, consists of the Chicago Mercantile Exchange, Chicago Board of Trade (CBOT), New York Mercantile Exchange (Nymex) and and Comex. It is the world's largest derivatives exchange for grains, livestock, oilseeds, dairy and timber.

Commenting on the lacklustre performance of the CME Group's US dollar-denominated palm oil contracts compared with ICDX's rising rupiah-denominated palm oil volume trade, Andriesen said: "Yes, the dollar palm oil contract got off on a slow start but we're very optimistic of its potential. You must remember that our contract is tied to Bursa Malaysia's palm oil futures, the global benchmark pricing for the commodity".

On how CME Group plans to generate more trade in the US dollar-denominated palm oil contracts, he said it is constantly looking to better its marketing and communications with its clients. It is also considering appropriate pricing, he added.

Andriesen said lowering the fees is one of the many tools the group was considering to attract traders to use its palm oil contracts.

Meanwhile, in response to CME Group's denial, ICDX chief executive officer Megain Widjaja clarified that the current confusion in news reports boils down to "a misunderstanding and perhaps, misinterpretation". Widjaja said he had never intended to confuse anyone about ICDX's planned expansion reach and accessibility to offshore products like those offered by CME Group.

He reiterated that the Indonesian government had recently passed new laws that would allow domestic traders to access foreign markets.

Overseas trading had been previously executed by a combination of phone broking and overseas accounts.

"What I meant to say is Indonesian participants can use ICDX to trade offshore products," Widjaja said. "The system was up-and-running as of last week and a few brokers have already signed up. If traders in Indonesia want to trade CME Group products, the ICDX is the platform and if CME Group wants business from Indonesia, this is one of the ways to go forward," he explained.

He pointed out that the new development in Indonesia does not involve any alliance with CME or Nybot - the New York Board of Trade, a commodity exchange operated by Intercontinental Exchange (ICE), a CME rival. However, through ICDX, traders in Indonesia will get direct access to CME and Nybot, Widjaja added.

Bursa aims to double derivatives trade volume

This is written by my colleague Zaidi Isham Ismail.

BURSA Malaysia Derivatives Bhd aims to double its daily trading average to 50,000 contracts over the next three years in line with growing investor interest. As at end of February, total derivatives contracts transacted at Bursa Malaysia stood at 34,000 per day.

Bursa Malaysia chairman Datuk Yusli Mohamed Yusoff said the collaboration with US-based CME Group to expand trading of commodity futures, increase the volume of existing products and introduce new products, would drive the market's growth.

"We see increasing participants in the derivatives market. We expect this trend to continue as we work together with the CME Group," Yusli told a press conference at the Palm and Lauric Oil Conference and Exhibition 2011 yesterday.

Last year, CME Group - the world's largest derivatives exchange - bought a 25 per cent stake in the local derivatives market, a wholly-owned subsidiary of Bursa Malaysia Bhd. Following this, CME routed all existing and future Bursa Malaysia Derivatives products on CME's platform, CME Globex.

The fact that Malaysia's derivatives products are traded on the Globex is already a big opportunity due to the international connection it holds, Yusli said.

He added that this would allow Bursa Malaysia to further penetrate, expand its products and garner more participation with the derivatives industry, which is expected to go through a healthy stage of growth.

"There is a lot of untapped business, and with the partnership with CME, we can widen the road to the international market," Yusli explained.

Currently, a total of nine futures contracts are traded on the Malaysian derivatives market with crude palm oil futures (FCPO) and the FTSE Bursa Malaysia Kuala Lumpur composite index futures leading the active contracts.

In November 2010, the FCPO hit a record monthly volume and an all-time high of 450,000 contracts, surpassing the previous record of 440,000 contracts achieved in April 2009.

Seeking sensible solutions to ‘climate hysteria’

This is written by Roger Helmer, member of the European Parliament.

AS SOMEONE who has lived and worked in Malaysia, I have watched with interest the growth of a nation that, in the 20 years since I left, achieved middle-income status, enjoying some of the most robust economic growth in the region. 

I am aware that much of this growth can be attributed to the success of plantation industries, first cocoa and rubber, and then oil palm.

Watching now as an elected British member of the European Parliament, I am struck by the challenges these industries currently face, challenges that originate in the developed West, based on an ideological belief in climate change.

The definition of and terms under which environmental sustainability is achieved in the developing world is dreamed up and pursued relentlessly by Western, taxpayer funded environmental groups, and prove both appealing and convenient for an increasingly protectionist European Union.

In collaboration with domestic industry, media and academia, the EU confidently extends the hand of “green colonialism” in Southeast Asia. For my views, I am identified as a “climate sceptic”.

For their views, may I suggest anti-development, anti-growth, anti-prosperity, anti-business, anti-capitalism?

The EU has decided that it wants to set a target for reducing carbon dioxide emissions in the EU by 20 per cent by 2020, while some call for targets of 30 per cent and higher. The EU can do all it wants to call for 20 per cent or 30 per cent reductions, but what we are actually going to see is an increase.

What I term “climate hysteria” will, in the long term, cost worldwide industry and the taxpayer dearly.

Even the EU’s energy commissioner, Günther Oettinger, has rejected these higher targets which, he has said, will result in a faster process of de-industrialisation in Europe.

Perhaps Oettinger is aware that the small changes in mean global temperatures which we’ve seen over the last hundred years are entirely consistent with well-established, long-term natural climate cycles, and do not serve as a basis for the EU to pursue business damaging, green protectionist policies.

And there is going to be great demand for palm oil, whether for food or for fuel.

I am convinced that in 10 years, the issue will no longer be climate change. The issue will be energy security and energy availability. The pressure will then be to diversify supply and technologies and to use every available source of energy. So, I see a great future for biofuels and palm oil as a biofuel.

However, despite the role commodities such as palm oil could play in global long-term energy solutions, the apparent consensus is that such industries should be limited.

How then is this second school of thought driving Western policy towards palm oil?

It is what Europe calls “participative democracy” and it wields great influence in the hands of non-governmental organisations. It is the opposite of what we call “representative democracy”, with the people electing their representatives and representatives making their decisions. There are a number of voices within the EU saying that representative democracy has had its time, and we need a new model.

But what is participative government? Instead of going to the people, you go to “civic society”. Civic society simply means NGOs. What is fascinating is that virtually every NGO that engages with EU institutions is actually funded, in part, by the European Commission itself.

The European Union has created is its own Hall of Mirrors. It has paid for its own set of interlocutors who reflect what the EU wants to hear.

Think of the incentives and motivations of an NGO. They are driven by the need to survive and the need to fund themselves. They also need to get funding from the public. And so their story must be alarming.

If you said last year that the sea level is going to rise by 10 feet, that is not a story. You have to say that the sea level is growing to rise by 20 feet. Each time, your prediction has to be more dramatic and alarmist than the last one.

A recent report by the United Kingdom Taxpayers Alliance found that in 2009/10, green NGOs received from the EU and the British government a total of £10 million (RM49 million) — three quarters of it from the EU and a quarter of it from the UK.

Now, why should we worry about that? By taking the public out of the loop, you are actually producing an anti-democratic structure. A structure designed to reinforce the prejudices of EU institutions. It means that the nexus of the NGOs and EU are pursuing the interests and preoccupations of a narrow elite.

As you may be aware, the NGOs have an enormous place in EU decision-making. The European Commission, when it is developing a legislative proposal, may talk to the industry, but it will also have Greenpeace, Friends of the Earth and the World Wildlife Fund talking to them as well. And that is in my view profoundly anti-democratic.

Certainly, in the UK, you get little old ladies leaving money to the World Wildlife Fund in their wills. You get two million people contributing to the Royal Society for the Protection of Birds (RSPB), the bird protection organisation. They are interested in conservation, not environmental advocacy. And yet their money is used for that purpose.

When we look at some of the more aggressive and strident of the green NGOs, people are neglected. They do not consider the needs and aspirations of real people.

How can you influence the work these NGOs are doing and the criticisms that they are levelling against your industry? You have to keep telling the truth over and over again. We have a phrase in politics — sunlight is the best disinfectant. The best way to deal with lies is to tell the truth.

But it does really matter that you respond with the facts in a targeted way. Public opinion is very important but, of course, it is people like the members of the European Parliament (MEPs) and the European Commission who are creating the misguided regulations.

The word is getting around, but a presence, probably in Brussels, where the decisions are being made will be key to navigating and influencing the complicated legislative process.

The task is difficult but not impossible. I believe that demographic changes and energy shortages and, indeed, food shortages mean that sensible solutions will have to prevail because we need the food and we need the fuel.