Anglo-Eastern Plantations warned Thursday that revenue and profitability would come under pressure from falling crude palm oil prices.

'The higher CPO [crude palm oil] production to date will not compensate for the drop in CPO price which is expected to lead to a lower revenue and profitability for the year ending 31 December 2018, as experienced by plantation companies across the industry, the company said.

For the first nine months ended 30 September 2018, total crude palm oil output rose 9% to 316,920 metric tonnes, due to both higher FFB production and external Fresh fruit bunches (FFB) purchase, the company said.

FFB rose 14% to 787,160 metric tonnes for the nine-month period from a year earlier, FFB bought-in increased 2% to 760,460 metric tonnes.

CPO prices fell 13% to $629 a metric tonnes for the first nine months of year, from $723 a metric tonne recorded in the comparative period of 2017.

CPO demand was given a boost when the Indonesian government expanded the B20 Program from 1 Sept. 2018, requiring the use of biodiesel blended fuels for all vehicles and heavy machinery, the company said.

The spread of Soyoil-CPO price ahd widened to more than $130 a tonne in early October 2018 from $90 a tonne at the end of August 2018 which should lift demand for CPO, the company added.


At 10:17am: (LON:AEP) AngloEastern Plantations PLC share price was +2p at 577p