KUALA LUMPUR, Nov 8 — United Plantations Bhd’s net profit jumped to RM154.15 million in the third quarter ended September 30, 2021 (Q3 2021) from RM95.33 million in Q3 2020.

Revenue surged 9.1 per cent year-on-year to RM525.5 million from RM334.04 million previously due to higher revenues from both its plantation and refinery segments, which rose by 19.2 per cent and 8.7 per cent, respectively.

The plantation division recorded better crude palm oil (CPO) and palm kernel (PK) production, as both rose by 7.5 per cent and 13.8 per cent, respectively, and the average CPO and PK prices grew by 5.7 per cent and 0.9 per cent, respectively, compared to Q2 2021.

“With the higher Malaysian Palm Oil Board CPO price in the current quarter, the windfall tax incurred at RM15.9 million was 25.5 per cent higher than the previous quarter,” it said in a filing with Bursa Malaysia today.

Meanwhile, the company’s refinery division saw higher selling prices in Q3 2021 compared to Q2 2021.

It noted that the shortage of guest workers in the palm oil industry continues to be a painful reminder of how fragile and labour intensive the oil palm industry is.

“Significant losses of fresh fruit bunches left unharvested in the fields has been a growing trend in the Malaysian palm oil industry this year.

“Indeed, Malaysia’s (oil palm) production has declined by 9.7 per cent during the nine months of the year vis-a-vis the same period in 2020 due to the inability to bring out the crop due to the chronic labour shortages,” it noted.

The decline of over 1.3 million tonnes of CPO during the nine months was the main contributing factor for the very bullish palm oil prices experienced in the last three to six months, said United Plantations.

Most market price forecasters have also lowered their 2021 CPO production estimates from around 20 million tonnes to around 18 million tonnes.

“Uncertainty regarding 2022 production is also considered as a key supportive factor for the current high prices as many uncertainties remain unaddressed.

“Nevertheless, like many asset prices currently seen around the world, the board views the current palm oil prices as being excessive and expects a correction to take place in the coming months,” United Plantations added. — Bernama