Chain Reaction Research: Felda Global Ventures
RSPO credentials at risk, immediate cash flow impacts
New data shows that Felda Global Ventures Holdings Berhad (FGV:MK) is in breach of Roundtable on Sustainable Palm Oil (RSPO) standards, as its subsidiaries cleared 880 ha of identified High Conservation Value peatlands. RSPO certified sustainable palm oil (CSPO) often sells at a premium to crude palm oil (CPO), which means FGV may lose this premium if temporarily suspended from RSPO. Malaysian palm oil giant IOI Corporation was temporarily suspended from RSPO in March 2016. If FGV follows suit it could loose a CSPO premium of 1% to 2% compared to their average 2015 selling price, resulting in $6 to $12 million in cash-flow-at-risk in 2016, excluding broader market share losses.
For more information, please contact Eric Wakker.