CIIF-Oil Mills reports P41M in H1 operating income amid low prices, supply

A group of five coconut oil producers reported an operating income of P41 million in the first half, amid low production and depressed prices of coconut-based products in the world market.

 

State-controlled CIIF-Oil Mills Group – comprising Legaspi Oil Co. Inc., San Pablo Manufacturing Corp., Cagayan de Oro Oil Co. Inc., Southern Luzon Coconut Oil Mill Inc., and Granexport Manufacturing Corp. – said it is on track toward its targeted P130 million in earnings for 2012.

 

“Notwithstanding, the unfavorable business situation in the world market characterized by depressed prices of copra and other coconut-based products, plus the low copra production in the first half of the year, we were able to steer CIIF-OMG into positive income,” president and CEO Jesus Arranza said in a statement Monday.

 

On back of a decrease in copra supply, the Philippine coconut oil output dropped to 365,760 metric tons (MT) in the first semester from 445,754 MT a year earlier.

 

In the first semester, copra prices dropped to P23 per kilo from P42 a year earlier while coconut oil prices fell to $980 per MT from $1,550 per MT in December 2011.

 

Arranza said the group’s trading strategy allowed the firm to make a profit in the face of a slow down in the commodity’s prices worldwide.

 

 The group expects copra production to pick up in the third quarter, creating the leeway to profit more for the rest of 2012, Arranza noted.

 

The group posted P205 million in operating net income for the whole of 2011. — MJC/VS, GMA News