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18 MSM MALAYSIA HOLDINGS BERHAD WHO WE ARE STATEMENT & DISCUSSION BY OUR LEADERS HOW WE OPERATE
ANNUAL INTEGRATED REPORT 2021
MARKET
LANDSCAPE
FY2021/FY2022 NATURAL GAS OVERVIEW
Natural Gas Price
Distribution segment
33.65 33.65 33.65 33.65 36.42
MSM has started 26.85 30.03
hedging the risk 22.14
of higher Natural 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
Gas prices in late FY2020 (RM/mmBtu) FY2021
FY2021 via Brent Gas Malaysia Bhd announced that the average natural gas selling price for the
link derivatives fourth quarter of 2021 beginning from 1 October 2021 to 31 December 2021 is at
RM36.42 per million British Thermal Units (MMBtu), compared to RM30.03
per MMBtu for the third quarter of 2021, which translates to a 21% increase.
contract as part Natural gas makes up 30% of the cost of refining and will post an upside risk in
FY2022. In early 2022, the Russian invasion in Ukraine has caused a shock to the
of the mitigation global energy supply. Brent Crude Oil prices have surged to new historical highs and
the shortage could prevail in the mid term. As a mitigation strategy, the business has
plans. embarked on hedging of Brent-linked derivatives.
The domestic Wholesale refined sugar ceiling price was
capped at RM2.69/kg for sugar manufacturers. As NY11
and natural gas price increase, sugar manufacturers will
experience a margin squeeze. Currently, the Management
is engaging the ministry in charge, KPDNHEP, to review
the current gazetted ceiling price for 1kg and 2kg retail
packs.