Felda Global Ventures (FGV) which is the commercial arm of Felda has been making losses for the past few years.
Things however are getting better when it returned to profitability recently.
This is a piece of good news set to benefit smallholders and the rakyat.
How will they benefit?
Let’s take a look.
FGV has been making losses for a long time until now
FGV reported to Bursa Malaysia on November 24 that it made a net profit of RM38.77 million in the third quarter compared to a net loss of RM73.6 million.
FGV has been making losses for several years now until last week.
This is positive development set to turn around the company.
A profitable FGV, will boost morale of the smallholders, the rakyat and the country.
FGV getting better as palm oil prices are getting stronger
After so many years of making losses, FGV is finally rebounding.
Crude palm oil prices are getting stronger due to strong demands from traditional buyers.
This include India, China, the European Union and parts of Asia.
As a result, crude palm oil prices are getting better and is set to benefit the economy.
FGV president and chief executive officer Datuk Zakaria Arshad said palm oil prices could improve to RM2.800 a tonne from RM2,000 currently.
FGV’s other businesses are also doing well
FGV also has a sugar refining business as well as logistics and trading businesses which are also doing well.
At the international market, cost of raw sugar has gone down and this will benefit FGV greatly.
All this should improve FGV’s profit in the fourth quarter of 2017.
So FGV’s prospects are getting better which will enable the company to make higher profit.
Palm oil price is a major income earner for the economy
During the 1997 regional economic crisis, palm oil rescued the country’s economy from collapsing.
At that time, our economy was being attacked by currency speculators.
Malaysia however survived due to commodities such as oil, rubber and palm oil.
Palm oil continues to be one of the country’s top commodities.
Palm oil is one of the country’s top income earners with total exports value of more than RM80 billion.
Palm oil will continue to be a top earner of the country sold in more than 300 countries.
What does it mean to the smallholders?
FGV also manage some 300,000ha of oil palm land owned by Felda’s 112,265 smallholders.
So when palm oil prices increase, naturally part of the profit will go to the smallholders.
Sometimes, a shareholder can earn RM2,000 to RM3,000 a month.
Smallholders can earn as high as RM5,000 if the international prices is strong.
This is good news for the smallholders who can earn an income for his family.
FGV is also home to millions of family members
FGV’s profitabily is very important because it is not just home for 112, 625 smallholders.
It is also home to the smallholders’ children.
If each smallholder has an average of 4 children.
There would be a total of 4 million smallholders children right now.
And now the 4 million children have married and given birth to more children.
FGV is now home to the second and third generation Felda.
A profitable FGV is very important to take care on the welfare of all Felda families.
How can the rakyat benefit
FGV is a public listed company on Bursa Malaysia.
If a Malaysian own shares in the company, they will be able to earn dividends.
Sometimes, Amanah Saham Bumiputera or Amanah Saham Nasional would own shares in FGV.
So when FGV makes a profit, ASB abd ASN will pay dividends to the accountholders.
In this way, a rakyat who has ASB accounts can earn dividends.
And with the dividends, the rakyat can spend the money for his family.
FGV is one of Malaysia’s brandnames and symbols
FGV is one of Malaysia’s national symbol of socio-economic success.
Felda was set up by the late Prime Minister Tun Abdul Razak Hussein in 1956.
Ever since then, Felda and FGV has become a symbol of the nation.
Now that FGV is doing well, it is testament of Malaysia’s strength.
It is also proof that the government’s efforts to take of the rakyat is gaining recognition.