Phibro closes down its Sulawesi cocoa project<\/p>\n
LONDON (Reuter): Commodities trader Phibro said yesterday it
\nclosed down its cocoa operations in Indonesia because the
\nbusiness had ceased to be attractive.<\/p>\n
\"We are just getting out of a business that doesn't have the
\nupside it had when we first got into it,\" Phibro Commodities
\ndirector Anthony Ward said.<\/p>\n
Trade sources in Indonesia said earlier that Phibro, one of
\nthe top cocoa buyers in the country, on Tuesday ended its
\npartnership with a local company based in Ujung Pandang, capital
\nof the cocoa growing region of South Sulawesi.<\/p>\n
Indonesian traders said the company had been a major buyer of
\ncocoa from Sulawesi, purchasing over 100,000 tons in the last 2-
\n1\/2 years alone.<\/p>\n
Ward said Phibro, a unit of U.S. Salomon Inc, had not made a
\nloss in Indonesia but no longer saw the opportunities that were
\nthere before because margins on Indonesian cocoa exports had
\nceased to be attractive.<\/p>\n
\"The reason (for closing down) is because we found the
\nbusiness attractive when prices of Indonesian beans were lower
\nand there were good margins and New York was still a buyer of
\nlast resort, so you had guaranteed returns.<\/p>\n
\"But once the market became more sophisticated and the
\ndifferential between Indonesia and Ivory Coast narrowed -- by
\nmore than 10 percent of the overall market price, from $300 to
\n$150 -- it's become less rewarding to be there,\" Ward said.<\/p>\n
Phibro had shut down its Malaysia cocoa operations two years
\nago for the same reason and moved to Indonesia, he added.<\/p>\n
\"It used to be good business exporting Malaysian cocoa but it
\nisn't any more.\"<\/p>\n
The Indonesian closure had nothing to do with a worldwide
\nreduction of Phibro's headcount reported last October and would
\nnot affect the company's overall cocoa operations, Ward said.<\/p>\n
\"I can confirm there is no change in what Phibro is doing in
\nthe cocoa market,\" he said.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/phibro-closes-down-its-sulawesi-cocoa-project-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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