Published March 27, 2008
Residential rents seen rising further
En bloc sales and population increase caused by influx of foreigners will continue to fuel demand, writes LEONARD TAY RESIDENTIAL rents bottomed out in 2004, recovering until 2007 when they staged an extraordinary rise, surging by more than 40 per cent within the year. This was the highest rate of increase in Urban Redevelopment Authority's private residential rental index since the index started in 1990. And 2008 is likely to see continued strength in rentals, although growing at a more modest pace of 5-10 per cent. Rents rose a negligible 0.2 per cent in 2004, and then a stronger 3.1 per cent in 2005, according to the URA private residential rental index. But as the residential sector recovered strongly from 2006 onwards, rental values rose more steeply. The non-landed residential segment, which forms the bulk of the leasing market, chalked up rental growth of 15 per cent in 2006 before sky-rocketing 43.1 per cent in 2007. A key reason for the supernormal growth in rents was the population increase as a result of immigration. Singapore's total population rose from 4,401,400 in 2006 to 4,588,600 in 2007, an addition of 187,200, of which Singapore residents made up 57,200 while foreigners constituted 130,000. This is a 14.8 per cent rise year-on-year and is the largest increase in the number of foreigners seen in over seven years. The foreign population refers to professionals, workers, students and their family members. This is the first time the total has crossed the one-million mark. The increase in 2006 was 9.7 per cent.
Main attractions The positive run in the economy, growth prospects for the country and an attractive living environment brought many here, leading to the surge in demand for housing accommodation. The foreigners chose Singapore because of the job opportunities here and its connectivity to other major cities in Asia. Generally, they formed the bulk of the tenant pool and the prime districts (Orchard, Holland and Bukit Timah areas) were their favourite locations. However, due to the recent escalating rents, more expatriates have opted to move out of the prime districts for cheaper accommodation elsewhere. Some have even gone ahead to buy their own homes instead of renting. The swelling demand was further fuelled by the number of residential projects that were sold on the collective sale market. A number of displaced home owners have rented in the interim while waiting for their new replacement homes to be completed. While rents have increased islandwide, some regions are ahead of the pack. Rents in the Core Central Region (districts 9, 10, 11, Downtown Core and Sentosa) lead the market with a median rent of $3.86 per sq ft per month, going by URA's median rent numbers at end-2007. This is followed by the Rest of Central Region with a median rent of $2.74 psf per month and the areas Outside of Central Region with a median rent of $2.01 psf per month. Using CBRE Research's basket of properties for the luxury, prime and island-wide segments of the leasing market, average rents have reached even higher levels. The average rent for luxury residences ended 2007 at $6.10 psf per month, having risen 36 per cent during the year. Properties in this luxury class include the top 10 to 15 completed condominiums located in the prestigious areas around Orchard Road. Average rents for prime residential properties were $4.50 psf per month, having increased by 55 per cent in 2007, while islandwide rents were $2.65 psf per month, after rising 33 per cent in the same period. As rentals at prime and popular locations become more expensive, both local and foreign residents have been moving further out; first to the city fringe and eventually along the east-west axis of the MRT lines to the suburban areas. A comparison of non-landed median rents from the URA's Realis system in December 2006 and December 2007 shows that the most significant increases have not been restricted to the central areas, but have been seen in the eastern and western parts of the island. It should be noted that although districts 9 and 10 remain the most popular among expatriates, these districts have a range of old and new residences, leading to a relatively lower median rent compared with those in district 4. The residential landscape in district 4 (Telok Blangah/Harbourfront) is generally more homogenous and comprises newer developments that can fetch a premium. Outlook for 2008 The leasing market is expected to remain firm in 2008 and rents will continue to rise, albeit at a more moderate pace in line with the less aggressive growth projected for the economy. The same phenomenon experienced in 2007 will continue into 2008 as fringe and suburban areas become more sought after by occupiers who find the higher rents in the prime central areas prohibitive. The spillover from the central area would cause rents to rise in other parts of the island and lead to overall growth in the leasing market. At the same time, as Singapore continues to attract the well-heeled from around the world, rents for luxury and city living condominiums in the popular areas around Orchard Road and the CBD will continue to move upwards. Average residential rents are expected to increase by about 5-10 per cent this year.
BT Leonard Tay is a director of CBRE Research
Monday, March 31, 2008
Thursday, March 27, 2008
China's milk hunger - China's milk production February 11, 2008
ARTICLE
China's milk hunger - China's milk production
Lior Yaron
Published: February 11, 2008
The Chinese dairy industry is expanding very rapidly to meet the demands of the rapidly changing dietary requirements of its huge population.
Local production will continue to increase but not at the same pace as demand, so import of milk products will continue.
The main limiting factors in Chinese milk production are: industry chain remains long and complicated, lack of experience and technology, land and climate limitations (central and south of China).
En
-->
Introduction
There are about 1.3 billion people in China, 745 million in the countryside and 555 million in the cities. The standard of life is increasing year by year, trying to reach that of the western world. The Chinese government considers milk to be an important part of the young person’s diet, and this, combined with the increasing western influence, is bringing a 10% yearly increase in dairy production – albeit from a relatively low base. Dairy production in China is changing rapidly and it will continue to do so in the near future. Milk production continues to grow rapidly in response to domestic demand, mainly in the urban sector.
Milk consumption
Twenty years ago China was not among the countries that were mentioned when we talked about milk consumption or production. The reasons for that were no tradition of milk products in the diet, that it it was an expensive product and the local people had low incomes, and lack of cooling facilities in the marketing chain. However in the last few years it has all changed dramatically. The urban population is growing rapidly, urban people have higher incomes which will be spent on high value food like milk. Government support for school milk and changing consumption habits. The average milk consumption in Beijing is about 46.2 kg per capita; even if only in the big cities people will reach this average, an additional 16 million tones of milk will be needed, equivalent to the total current New Zealand milk production (source: IFCN).
Milk production
There are today about 14 million dairy cows in China producing about 34 MMT of milk. The growth rate in cows and production is about 10% to 15% per year which comes mainly from increasing the number of cows. China is still importing a lot of dairy products mainly from the US, EU, Australia and New Zealand. The main regions for milk production are the North East, Central North and North West of China while in the meantime the main consumption areas are in the east and the south of China.
There are three different units of production:
1. Small private units – one to ten cow farm units are very common (60% of the cows) but at the same time there are also 50 - 100 cow units in this sector. The logistics problems with such small units are being resolved by a unique solution in China: a) Village Milk Centre (VMC) – in the middle of the village there is a milking centre and each farmer brings his cows to be milked there by a professional milkman.b) Hotel farm – all the farmers in one village bring their cows to one big dairy farm. They are shareholders in this operation but not working in it.
2. State owned farm – typically with 800 to 2000 cows. They normally require advanced equipment. They represent about 8% of the dairy cows.
3. Large dairy farms – owned by large dairies –typically with 1,000 to 10,000 cows. They normally require advanced equipment and they represent about 3% of the dairy cows.
The main challenges that the dairy industry will have in the near future are:
1. Milk quality – since the demand is much higher than supply the quality issue hasn’t yet come down to the farm level. Most of the dairy farmers are backyard farmers with other farming business and dairy is only one of them. Most of those farmers are new to the business with low levels of understanding of the dairy business; especially what milk quality is all about, cow comfort and nutrition of dairy cows.
2. Feeding cows – most of the know how about it came from mono gastric animals like pigs and chickens, there is lack of understanding of the importance of forage and forage quality in ruminants nutrition, and the farm structure is such that it is very difficult to get enough forage close to big cities. The increases in feed prices are creating big debates regarding crop production compared to milk production.
3. Support units for the farm and farmers: right now it’s very difficult to find any support units which can solve problems at the farm level: no extension service, herd book system, farmer association, dairy cattle breeder association, milk quality and mastitis control laboratory, or feed and forage laboratory.
Summary
The Chinese dairy industry is expanding very rapidly to meet the demands of the rapidly changing dietary requirements of its huge population.
Local production will continue to increase but not at the same pace as demand, so import of milk products will continue.
The main limiting factors in Chinese milk production are: industry chain remains long and complicated, lack of experience and technology, land and climate limitations (central and south of China).
This article was presented at the International Dairy Farmers' Congress 2008 in Berlin
China's milk hunger - China's milk production
Lior Yaron
Published: February 11, 2008
The Chinese dairy industry is expanding very rapidly to meet the demands of the rapidly changing dietary requirements of its huge population.
Local production will continue to increase but not at the same pace as demand, so import of milk products will continue.
The main limiting factors in Chinese milk production are: industry chain remains long and complicated, lack of experience and technology, land and climate limitations (central and south of China).
En
-->
Introduction
There are about 1.3 billion people in China, 745 million in the countryside and 555 million in the cities. The standard of life is increasing year by year, trying to reach that of the western world. The Chinese government considers milk to be an important part of the young person’s diet, and this, combined with the increasing western influence, is bringing a 10% yearly increase in dairy production – albeit from a relatively low base. Dairy production in China is changing rapidly and it will continue to do so in the near future. Milk production continues to grow rapidly in response to domestic demand, mainly in the urban sector.
Milk consumption
Twenty years ago China was not among the countries that were mentioned when we talked about milk consumption or production. The reasons for that were no tradition of milk products in the diet, that it it was an expensive product and the local people had low incomes, and lack of cooling facilities in the marketing chain. However in the last few years it has all changed dramatically. The urban population is growing rapidly, urban people have higher incomes which will be spent on high value food like milk. Government support for school milk and changing consumption habits. The average milk consumption in Beijing is about 46.2 kg per capita; even if only in the big cities people will reach this average, an additional 16 million tones of milk will be needed, equivalent to the total current New Zealand milk production (source: IFCN).
Milk production
There are today about 14 million dairy cows in China producing about 34 MMT of milk. The growth rate in cows and production is about 10% to 15% per year which comes mainly from increasing the number of cows. China is still importing a lot of dairy products mainly from the US, EU, Australia and New Zealand. The main regions for milk production are the North East, Central North and North West of China while in the meantime the main consumption areas are in the east and the south of China.
There are three different units of production:
1. Small private units – one to ten cow farm units are very common (60% of the cows) but at the same time there are also 50 - 100 cow units in this sector. The logistics problems with such small units are being resolved by a unique solution in China: a) Village Milk Centre (VMC) – in the middle of the village there is a milking centre and each farmer brings his cows to be milked there by a professional milkman.b) Hotel farm – all the farmers in one village bring their cows to one big dairy farm. They are shareholders in this operation but not working in it.
2. State owned farm – typically with 800 to 2000 cows. They normally require advanced equipment. They represent about 8% of the dairy cows.
3. Large dairy farms – owned by large dairies –typically with 1,000 to 10,000 cows. They normally require advanced equipment and they represent about 3% of the dairy cows.
The main challenges that the dairy industry will have in the near future are:
1. Milk quality – since the demand is much higher than supply the quality issue hasn’t yet come down to the farm level. Most of the dairy farmers are backyard farmers with other farming business and dairy is only one of them. Most of those farmers are new to the business with low levels of understanding of the dairy business; especially what milk quality is all about, cow comfort and nutrition of dairy cows.
2. Feeding cows – most of the know how about it came from mono gastric animals like pigs and chickens, there is lack of understanding of the importance of forage and forage quality in ruminants nutrition, and the farm structure is such that it is very difficult to get enough forage close to big cities. The increases in feed prices are creating big debates regarding crop production compared to milk production.
3. Support units for the farm and farmers: right now it’s very difficult to find any support units which can solve problems at the farm level: no extension service, herd book system, farmer association, dairy cattle breeder association, milk quality and mastitis control laboratory, or feed and forage laboratory.
Summary
The Chinese dairy industry is expanding very rapidly to meet the demands of the rapidly changing dietary requirements of its huge population.
Local production will continue to increase but not at the same pace as demand, so import of milk products will continue.
The main limiting factors in Chinese milk production are: industry chain remains long and complicated, lack of experience and technology, land and climate limitations (central and south of China).
This article was presented at the International Dairy Farmers' Congress 2008 in Berlin
Wednesday, March 26, 2008
Yishun condo site draws record bid of $213.5m
A YISHUN condominium site drew a higher-than-expected top bid when its tender closed yesterday, belying expectations of a property market slide.
Developer MCL Land offered $213.5 million for the 99-year leasehold plot, which works out to about $350 per sq ft per plot ratio (psf ppr) - believed to be a new benchmark for Yishun.
HIGH BID = HIGH HOME PRICES?
Property consultants said the higher-than-expected offer by MCL Land could translate into the finished project selling at record prices for Yishun, even as home buyers are now holding out for lower prices in a subdued market.
Property consultants said this could translate into the finished project selling at record prices for the area, even as home buyers are now holding out for lower prices in a subdued market.
Mr Nicholas Mak, director of research and consultancy at Knight Frank, estimated that the end units for the Yishun project could be priced from $830 psf up to almost $900 psf.
This would be almost double what the 99-year leasehold Orchid Park Condo down the road is fetching. Four units at the 14-year-old development have been sold there this year at an average price of $460 psf.
MCL Land's bid pipped four others and came in almost 70 per cent higher than the next bid, from Peak Green, at $127 million, or $208 psf ppr.
Frasers Centrepoint, Sim Lian and Hong Kong's Cheung Kong also tabled offers ranging from $57.7 million to $109.7 million, or $95 to $180 psf ppr - which some consultants said were 'unrealistically low' bids. They had predicted bids of between $200 and $300 psf ppr.
But Mr Li Hiaw Ho, executive director of CBRE Research, said the response was 'fairly robust' and signalled 'developers' confidence in the suburban segment despite the current lukewarm response to new projects'.
'Should the United States enter a mild recession and the sub-prime problems clear up, sentiment for suburban homes should improve after June, bringing demand and upward price momentum back to the market.'
Experts described MCL Land's offer as 'extremely bullish' and suggested that the developer may be short on land bank in the mass market segment.
MCL Land said in its latest financial results that it bought some sites last year, including Holland Hill Mansions and Dynasty Court Garden 1 in Sixth Avenue. Its land bank can now yield 780 units with a total gross floor area of 1.4 million sq ft.
The Yishun site is at the corner of Yishun Avenues 1 and 2, and is 10 minutes' walk from Khatib MRT Station. It is next to Yishun Stadium and overlooks Lower Seletar Reservoir.
'The site is good in that frontage to the reservoir is fantastic,' said Mr Ku Swee Yong, director of marketing and business development at Savills Singapore. 'I agree you should pay a premium for this site, but this seems to be a very significant premium.'
Separately, HDB yesterday put two more sites up for sale through its reserve list system.
One is a 182,986 sq ft plot at Jurong West Street 42 for executive condos, while the other is a 244,341 sq ft condo site at Chestnut Avenue in Bukit Panjang.
Developer MCL Land offered $213.5 million for the 99-year leasehold plot, which works out to about $350 per sq ft per plot ratio (psf ppr) - believed to be a new benchmark for Yishun.
HIGH BID = HIGH HOME PRICES?
Property consultants said the higher-than-expected offer by MCL Land could translate into the finished project selling at record prices for Yishun, even as home buyers are now holding out for lower prices in a subdued market.
Property consultants said this could translate into the finished project selling at record prices for the area, even as home buyers are now holding out for lower prices in a subdued market.
Mr Nicholas Mak, director of research and consultancy at Knight Frank, estimated that the end units for the Yishun project could be priced from $830 psf up to almost $900 psf.
This would be almost double what the 99-year leasehold Orchid Park Condo down the road is fetching. Four units at the 14-year-old development have been sold there this year at an average price of $460 psf.
MCL Land's bid pipped four others and came in almost 70 per cent higher than the next bid, from Peak Green, at $127 million, or $208 psf ppr.
Frasers Centrepoint, Sim Lian and Hong Kong's Cheung Kong also tabled offers ranging from $57.7 million to $109.7 million, or $95 to $180 psf ppr - which some consultants said were 'unrealistically low' bids. They had predicted bids of between $200 and $300 psf ppr.
But Mr Li Hiaw Ho, executive director of CBRE Research, said the response was 'fairly robust' and signalled 'developers' confidence in the suburban segment despite the current lukewarm response to new projects'.
'Should the United States enter a mild recession and the sub-prime problems clear up, sentiment for suburban homes should improve after June, bringing demand and upward price momentum back to the market.'
Experts described MCL Land's offer as 'extremely bullish' and suggested that the developer may be short on land bank in the mass market segment.
MCL Land said in its latest financial results that it bought some sites last year, including Holland Hill Mansions and Dynasty Court Garden 1 in Sixth Avenue. Its land bank can now yield 780 units with a total gross floor area of 1.4 million sq ft.
The Yishun site is at the corner of Yishun Avenues 1 and 2, and is 10 minutes' walk from Khatib MRT Station. It is next to Yishun Stadium and overlooks Lower Seletar Reservoir.
'The site is good in that frontage to the reservoir is fantastic,' said Mr Ku Swee Yong, director of marketing and business development at Savills Singapore. 'I agree you should pay a premium for this site, but this seems to be a very significant premium.'
Separately, HDB yesterday put two more sites up for sale through its reserve list system.
One is a 182,986 sq ft plot at Jurong West Street 42 for executive condos, while the other is a 244,341 sq ft condo site at Chestnut Avenue in Bukit Panjang.
Fund tops Serangoon site tender with $801m bid Located above MRT station
Fund tops Serangoon site tender with $801m bid Located above MRT station, it will be used for a mall and new bus interchange. -->
Joyce Teo
Thu, Mar 27, 2008The Straits Times
THE sleepy Serangoon area received a huge vote of confidence yesterday when a fund bid a sky-high $800.9 million for a land site, which will be used for a mall and a new bus interchange.
Six hopefuls lined up for the 99-year leasehold plot above Serangoon MRT station with four bidding over $660 million - well above the figure some people in the property industry thought the plot would attract.
The $800.9 million bid came from Pramerica Real Estate Investors (Asia) but was submitted under the name Gold Ridge. It reflects a price of $850 per sq ft (psf) of gross floor area.
This was 10 per cent above the second bid of $727 million from Serangoon Community Developments. Another bid came in at $401 million and one was a distant $215 million.
The site - launched by the Land Transport Authority - is destined to be a hub with Serangoon MRT serving as a junction station for the new Circle Line. Any development must include a new bus interchange integrated with the enlarged North-East and Circle Line stations.
The strategic location also offers enormous retail opportunities, say property experts.
'Serangoon Central is not a heavy residential area but there are no major malls within a 3km to 5km radius,' said Mr Danny Yeo, Knight Frank's deputy managing director.
'A mall can be a regional centre. The only tricky situation is that there can only be slightly over 200 carpark lots.'
Pramerica intends to build a full retail centre. It manages the Asian Retail Mall Fund I and II, which own several malls here, including Liang Court in River Valley, White Sands in Pasir Ris and Century Square in Tampines.
The Serangoon mall could have a net lettable area of around 600,000 sq ft, said CBRE Research executive director Li Hiaw Ho.
That would make it of similar size to Parkway Parade in Marine Parade and IMM in Jurong.
The plot is designated a white site, meaning it can be used for different functions, such as residential or commercial, but a full retail mall would bring the highest profit margin, said Savills Residential director Ku Swee Yong - and the highest risk in terms of cash flow.
The site has a gross floor area of 87,527 sq m. Consultants said a mall could probably bring average gross rent of up to $14 psf.
Assuming rent of $12 psf to $13 psf, the developers could expect a net income yield of about 5.5 per cent on a stabilised basis, said Mr Li.
Those who placed the lower bids were probably looking at a residential component, which could eventually sell for $800 psf to $900 psf, consultants said.
While the residential space would help with cash flow, proceeds from apartment sales should not be used to fund the retail mall, said an industry expert.
This is to avoid paying heavy taxes when the developer eventually sells the mall.
Meanwhile, the Urban Redevelopment Authority made available two 99-year leasehold sites yesterday. Interested developers can apply to have these reserve list sites put up for tender.
One is a 0.55ha plot at the junction of Clemenceau Avenue and Havelock Road, which is designated for a hotel of up to six storeys.
Another is a 3.07ha residential plot in Upper Changi Road North.
Mr Nicholas Mak, Knight Frank's director of research and consultancy, said the first site could accommodate a three- to four-star hotel with up to 270 rooms. If it is put up for tender, its land price is estimated to be $75 million to $81 million, or $600 psf to $650 psf of gross floor area.
The second site could have up to 400 condo units and fetch between $83 million and $111 million, with new units commanding $650 psf to $720 psf.
var newwindow;
Joyce Teo
Thu, Mar 27, 2008The Straits Times
THE sleepy Serangoon area received a huge vote of confidence yesterday when a fund bid a sky-high $800.9 million for a land site, which will be used for a mall and a new bus interchange.
Six hopefuls lined up for the 99-year leasehold plot above Serangoon MRT station with four bidding over $660 million - well above the figure some people in the property industry thought the plot would attract.
The $800.9 million bid came from Pramerica Real Estate Investors (Asia) but was submitted under the name Gold Ridge. It reflects a price of $850 per sq ft (psf) of gross floor area.
This was 10 per cent above the second bid of $727 million from Serangoon Community Developments. Another bid came in at $401 million and one was a distant $215 million.
The site - launched by the Land Transport Authority - is destined to be a hub with Serangoon MRT serving as a junction station for the new Circle Line. Any development must include a new bus interchange integrated with the enlarged North-East and Circle Line stations.
The strategic location also offers enormous retail opportunities, say property experts.
'Serangoon Central is not a heavy residential area but there are no major malls within a 3km to 5km radius,' said Mr Danny Yeo, Knight Frank's deputy managing director.
'A mall can be a regional centre. The only tricky situation is that there can only be slightly over 200 carpark lots.'
Pramerica intends to build a full retail centre. It manages the Asian Retail Mall Fund I and II, which own several malls here, including Liang Court in River Valley, White Sands in Pasir Ris and Century Square in Tampines.
The Serangoon mall could have a net lettable area of around 600,000 sq ft, said CBRE Research executive director Li Hiaw Ho.
That would make it of similar size to Parkway Parade in Marine Parade and IMM in Jurong.
The plot is designated a white site, meaning it can be used for different functions, such as residential or commercial, but a full retail mall would bring the highest profit margin, said Savills Residential director Ku Swee Yong - and the highest risk in terms of cash flow.
The site has a gross floor area of 87,527 sq m. Consultants said a mall could probably bring average gross rent of up to $14 psf.
Assuming rent of $12 psf to $13 psf, the developers could expect a net income yield of about 5.5 per cent on a stabilised basis, said Mr Li.
Those who placed the lower bids were probably looking at a residential component, which could eventually sell for $800 psf to $900 psf, consultants said.
While the residential space would help with cash flow, proceeds from apartment sales should not be used to fund the retail mall, said an industry expert.
This is to avoid paying heavy taxes when the developer eventually sells the mall.
Meanwhile, the Urban Redevelopment Authority made available two 99-year leasehold sites yesterday. Interested developers can apply to have these reserve list sites put up for tender.
One is a 0.55ha plot at the junction of Clemenceau Avenue and Havelock Road, which is designated for a hotel of up to six storeys.
Another is a 3.07ha residential plot in Upper Changi Road North.
Mr Nicholas Mak, Knight Frank's director of research and consultancy, said the first site could accommodate a three- to four-star hotel with up to 270 rooms. If it is put up for tender, its land price is estimated to be $75 million to $81 million, or $600 psf to $650 psf of gross floor area.
The second site could have up to 400 condo units and fetch between $83 million and $111 million, with new units commanding $650 psf to $720 psf.
var newwindow;
Higher housing grant for singles who live with parents
GOOD news for singles who want to buy a Housing Board flat to live with their parents.
They will get a higher CPF housing grant of $20,000 - from the current $11,000 - from April 1, the HDB announced on Thursday morning.
This higher-tier singles grant will also apply to eligible singles buying flats under the Design, Build and Sell Scheme (DBSS).
The catch is: the eligible single must commit to living together with his parents in the resale flat for at least five years.
Within the five years, the parents cannot buy or take over the ownership of another HDB flat, or invest in a private property, said the HDB.
Under the single Singapore citizen (SSC) scheme, single Singaporeans aged 35 years and above can get a CPF housing grant of $11,000 to buy a HDB resale flat if they satisfy the eligibility conditions.
Minister for Prime Minister's Office, Mr Lim Boon Heng, announced the higher singles grant in Parliament on March 8.
'It is a pro-family initiative to encourage children to look after their parents,' said the HDB.
The higher-tier singles grant will apply to resale applications or booking of DBSS flats from April 1.
All other prevailing policies such as the income ceiling, minimum occupation period for resale, will apply.
For enquiries, the public can call the toll free Sales/Resale Customer Service Line at 1800 8663 066.
They will get a higher CPF housing grant of $20,000 - from the current $11,000 - from April 1, the HDB announced on Thursday morning.
This higher-tier singles grant will also apply to eligible singles buying flats under the Design, Build and Sell Scheme (DBSS).
The catch is: the eligible single must commit to living together with his parents in the resale flat for at least five years.
Within the five years, the parents cannot buy or take over the ownership of another HDB flat, or invest in a private property, said the HDB.
Under the single Singapore citizen (SSC) scheme, single Singaporeans aged 35 years and above can get a CPF housing grant of $11,000 to buy a HDB resale flat if they satisfy the eligibility conditions.
Minister for Prime Minister's Office, Mr Lim Boon Heng, announced the higher singles grant in Parliament on March 8.
'It is a pro-family initiative to encourage children to look after their parents,' said the HDB.
The higher-tier singles grant will apply to resale applications or booking of DBSS flats from April 1.
All other prevailing policies such as the income ceiling, minimum occupation period for resale, will apply.
For enquiries, the public can call the toll free Sales/Resale Customer Service Line at 1800 8663 066.
China giving greater support to agriculture to cool inflation
China giving greater support to agriculture to cool inflation 2008-03-26 21:33:08 BEIJING, March 26 (Xinhua) -- China promised on Wednesday to increase financial support for agricultural production as part of a larger effort to cool an inflation surge blamed on food shortages. "Reinforcing agriculture has a pivotal role in maintaining sound and fast economic development, curbing inflation and safeguarding stability," the State Council, or the Cabinet, said in a statement. The Cabinet agreed in an executive meeting chaired by Premier Wen Jiabao that China would "immediately" increase the subsidies for farmers' purchase of production materials and seeds, and raise the government's purchasing prices of grain. The move was meant to "mobilize the initiative of farmers to plant crops and ensure an adequate supply of agricultural and sideline products," it said. The announcement added to a string of efforts to end shortages of pork, China's staple meat, and other basic commodities that pushed the inflation rate to a near 12-year high of 8.7 percent in February. Pork production fell dramatically last summer on breeders' dampened enthusiasm due to rising feed costs in addition to a massive pig cull after the outbreak of blue-ear disease in some regions. The unusually harsh winter weather also dealt a serious blow to vegetable and rapeseed crops in many areas and killed many pigs and chickens. The central government's budget earmarked for agriculture, farmers and rural areas reached 562.5 billion yuan (79.2 billion U.S. dollars) this year, 130.7 billion yuan more than in 2007, according to the government work report delivered by Wen earlier this month. The sum included a subsidy of 48.2 billion yuan for production materials purchase, 4 billion yuan for farm tools and 7.07 billion yuan for seed. Editor: Du Guodong
...more financial support for agricultural products.... at present there are already a subsidy abt $2 per straw for bull semen :).... although not mention I think there might be more subsidy :)
...The raw milk condition is worsen by the pig problem (B E disease)... with culling of some cows. (most prob low yielding or older cows)
...more financial support for agricultural products.... at present there are already a subsidy abt $2 per straw for bull semen :).... although not mention I think there might be more subsidy :)
...The raw milk condition is worsen by the pig problem (B E disease)... with culling of some cows. (most prob low yielding or older cows)
Sunday, March 23, 2008
Property Debt comfortable level
A good article on Wallstraits by Dennis on property loans advice
Below is what I shared at another forum, warning Forumers the dangers of over-borrowing and Never, Never, Never Over-borrow.
Cheers!Dennis Ng
If a person or household earns $5,000, keeping Debt-service ratio at 35% (or max Housing Loan instalment of S$1,750), and assuming a 25 years loan period, and an interest rate of 4% (it's better to assume a higher interest rate to be Prudent), the Maximum Housing Loan a person should take (assuming NO other debt) is about S$331,541.85.
Assuming this person takes a 80% Loan, max purchase price of Property is S$414,427. I read somewhere that the average Household income is over S$6,000 (not S$5,000). Using S$6,000 to calculate instead, max Purchase Price of Property is S$500,000. It does appear that current property prices are above what a person can comfortably afford, according to Prudent Personal Finance Principles. Note: banks are comfortable with 40% Debt-service ratio, if we use 40% instead, the max loan would work out to S$454,686 and max purchase price of properties would be S$568,357 instead.whether based on Median Income or Average Income, if we use Prudent Financial Principles as a guide, I agree that property prices are currently above the prices what a person can comfortably buy and comfortably borrow. I would advise a max loan financing of 80%.
If people NEED* to take 90% financing, they are buying/borrowing over their means. We should NEVER, NEVER, NEVER over-borrow. Over-borrowing can lead to a person's Financial Demise. *Note: this is different from a property investor who CHOOSES to take a 90% financing to minimise Cash Outlay but who have the Financial Means to make a 20% downpayment.
Another thing people should note is that current property prices are already much higher than say, 2 years ago, and as prices move higher, risks increase instead of reduce.And the economy is slowing down and there might be retrenchments in future due to economic uncertainties. Thus, anyone buying a property should standby Cash/CPF sufficient to pay for at least 12 months to 24 months of Housing Loan instalment as a "Safety Buffer". This will ensure he/she can continue to service the Housing Loan even if he/she lose his/her income. If they cannot afford to do what I advise, suggest that they NOT buy a property, they should continue to save some more money so that they can meet the guidelines I shared.
Cheers!Dennis Ng
Happy Good Friday
Went over to my sis-in-law for their house warming in Selangor (Bukit Jelutong).
I quite liked the spacious garden - brazilian trees/ palm trees, white and black big pebbles flooring at the porch and carpet grass. It is 7600 sq feet, very hugh. I also liked the high ceilings - giving it a cosy homely feeling. Also the AV hi-fi room was very professional. - with pre amp/ power amp, CDs and big speakers. The yellow lighting and carpet and sofa made the whole room very professional. I heard the house is about 1.4 Mio RM.
Visited Datuk's house in Bangsa - another high end residential district. What I liked was the curving / ovalish flooring. It has a fantastic view as well.
What did not look too good was that it did not have a spacious garden, and the ceilings was too short.
Another high end condominium popular with Singaporeans is Mont Kiara
I quite liked the spacious garden - brazilian trees/ palm trees, white and black big pebbles flooring at the porch and carpet grass. It is 7600 sq feet, very hugh. I also liked the high ceilings - giving it a cosy homely feeling. Also the AV hi-fi room was very professional. - with pre amp/ power amp, CDs and big speakers. The yellow lighting and carpet and sofa made the whole room very professional. I heard the house is about 1.4 Mio RM.
Visited Datuk's house in Bangsa - another high end residential district. What I liked was the curving / ovalish flooring. It has a fantastic view as well.
What did not look too good was that it did not have a spacious garden, and the ceilings was too short.
Another high end condominium popular with Singaporeans is Mont Kiara
Wednesday, March 19, 2008
CLSA: Sell The Milk And Milk Processors
CLSA: Sell The Milk And Milk Processors Positions must be cut entirely on pure Milk re-sellers like Anik, Modern, Heritage and Kwality Dairies, while exposure reduced to Britannia and Nestle.
China's Milk Dairies are sinking deep into the Red as Raw Milk prices rise, and the PRC Government imposes price controls on Milk and Milk products sold in Greater China region.
-Local Dairy Associations in Inner Mongolia, Heilongjiang and Shandong provinces have reported tight supplies of Raw Milk, with no signs of supply shortfalls easing in the near future.
-As price of Grain and Feed Stuff rises Breeding of Cows has been stopped in most Milk producing regions of China, with many farmers resorting to Culling the cows.
-As a pure statistic the number of Cows in the Shandong province have declined by 50 per cent in the period 2003-07.
-Very surprisingly new Milk processing plants have been set up in Shandong, Yili, Mengniu adding to the fierce competition that prevails in procuring Raw Milk.
-Raw Milk prices have consequently risen 67 per cent in the past 2 years, most of the price increases have not been passed on to consumers leading to a massive reduction in operating margins for Dairy producers.
-As a thumb rule, if Raw Milk prices rise by 5 per cent operating margins sink by 31 per cent.
A similar scenario could prevail in India as well, which is seeing the price of grain and raw feed prices going up in rural areas with direct and indirect price controls being imposed on Milk prices.
Positions must be cut entirely on pure Milk re-sellers like Anik, Modern, Heritage and Kwality Dairies, while exposure reduced to Britannia and Nestle.
With 150 tonnes of raw milk processing setting up in March by China Milk, look for further upside.
What about the bull sperm business ? It should be relatively unaffected as with the demand for raw milk, and limited land in China, there should be steady demand for high yielding bull sperms.
China's Milk Dairies are sinking deep into the Red as Raw Milk prices rise, and the PRC Government imposes price controls on Milk and Milk products sold in Greater China region.
-Local Dairy Associations in Inner Mongolia, Heilongjiang and Shandong provinces have reported tight supplies of Raw Milk, with no signs of supply shortfalls easing in the near future.
-As price of Grain and Feed Stuff rises Breeding of Cows has been stopped in most Milk producing regions of China, with many farmers resorting to Culling the cows.
-As a pure statistic the number of Cows in the Shandong province have declined by 50 per cent in the period 2003-07.
-Very surprisingly new Milk processing plants have been set up in Shandong, Yili, Mengniu adding to the fierce competition that prevails in procuring Raw Milk.
-Raw Milk prices have consequently risen 67 per cent in the past 2 years, most of the price increases have not been passed on to consumers leading to a massive reduction in operating margins for Dairy producers.
-As a thumb rule, if Raw Milk prices rise by 5 per cent operating margins sink by 31 per cent.
A similar scenario could prevail in India as well, which is seeing the price of grain and raw feed prices going up in rural areas with direct and indirect price controls being imposed on Milk prices.
Positions must be cut entirely on pure Milk re-sellers like Anik, Modern, Heritage and Kwality Dairies, while exposure reduced to Britannia and Nestle.
With 150 tonnes of raw milk processing setting up in March by China Milk, look for further upside.
What about the bull sperm business ? It should be relatively unaffected as with the demand for raw milk, and limited land in China, there should be steady demand for high yielding bull sperms.
Thursday, March 13, 2008
Agricultural Commodity Stock - China Milk
Something I find interesting and the price very appetising.
It has with other China stocks badly beaten up, dropping ( 60%) from a high of 1.63 to now 67 cents.
1 - cheap
2 - recession proof
3 - good ride on agriculture commodity play. Agricultural commodity run is in its infant stage. The metal commodities with all the infrastructure boom has started from 1999 to now. For Agricultural Commodity, I believe it started around 2003, which means it has 4-5 more years to run to catch up with the metal commodities. And at presently, AC is at 1st of 3 stages.
4 - a recent report which mentions that funds have the intention to put 10% of their money to agricultural commoditiy stocks.
5 - A remark by China's prime minister Wen Jiabao: "I have a dream - a dream to be able to provide all Chinese, especially our children, with half a litre of milk a day." The result has been a huge increase in milk consumption in China and demand is growing at a rate of around 25% a year. China’s milk consumption continues to be spurred by consumers demanding healthier and more nutritious foods. With rising affluence in the world’s fast-growing consumer market, there is a rapidly growing penchant for international food and beverage concepts which use a lot of milk and milk products. The PRC government has also been promoting the need for nutrition as evidenced by the government’s nation-wide School Milk Programme.
Why China Milk,
- With limited pasture land, China cannot continue to increase the number of cows to enhance its milk supply. China has much to catch up in terms of improving the milk yield of its cows.
- Based in the Heilongjiang Province, our subsidiary is the largest company specialising in the production of bull semen, dairy cow embryos and raw milk in China *
* According to China Dairy Industry Association
- It is building a 150 000 tonnes raw milk processing factory. They have signed a contract to provide OEM with raw milk, As of Jan qtr report, it has installed the milk machines by early march and will commence trial production for 1 month.
- The outbreak of mad cow disease in Canada and the U.S. in 2003 knocked the North American cattle industry on its back. The largest importers of U.S. and Canadian beef, including Japan, South Korea, and China, banned the import of beef from North America. But for China Milk Products, the restrictions proved to be a blessing in disguise. The privately owned raw milk company had already purchased 970 Canadian Holstein cattle. Its state-owned rivals failed to import as many cattle because they had to navigate government bureaucracy to get bank loans. Today, China Milk owns the largest herd of Holstein cattle in China and ranks 50th in BusinessWeek's annual Hot Growth rankings of Asia companies
Any rancher wanting to breed his cows with a Canadian Holstein has to go to China Milk. The company charges its customers $9.50 per sample of bull semen from a Canadian Holstein, compared with $6.75 from Australian Holsteins and $2.70 from Chinese Holsteins. However, Chinese ranchers are still willing to pay a premium for Canadian Holsteins, especially after receiving a little help from the government.
Starting this year, the Chinese government is giving Chinese ranchers a subsidy of $2 toward each sample of bull semen.
- China consumption of dairy products is about 20kg in 2006. It is a low base compared to other countries. With a greater awareness of nourishment with drinking of milk, and better life style (ice cream/butter/ yoghurt), demand will continue to increase
- Tourism will continue to be strong after the China Olympics. With more Ang mos visiting China, they will want their daily milk, butter, pasta, yoghurt, boosting demand.
It has with other China stocks badly beaten up, dropping ( 60%) from a high of 1.63 to now 67 cents.
1 - cheap
2 - recession proof
3 - good ride on agriculture commodity play. Agricultural commodity run is in its infant stage. The metal commodities with all the infrastructure boom has started from 1999 to now. For Agricultural Commodity, I believe it started around 2003, which means it has 4-5 more years to run to catch up with the metal commodities. And at presently, AC is at 1st of 3 stages.
4 - a recent report which mentions that funds have the intention to put 10% of their money to agricultural commoditiy stocks.
5 - A remark by China's prime minister Wen Jiabao: "I have a dream - a dream to be able to provide all Chinese, especially our children, with half a litre of milk a day." The result has been a huge increase in milk consumption in China and demand is growing at a rate of around 25% a year. China’s milk consumption continues to be spurred by consumers demanding healthier and more nutritious foods. With rising affluence in the world’s fast-growing consumer market, there is a rapidly growing penchant for international food and beverage concepts which use a lot of milk and milk products. The PRC government has also been promoting the need for nutrition as evidenced by the government’s nation-wide School Milk Programme.
Why China Milk,
- With limited pasture land, China cannot continue to increase the number of cows to enhance its milk supply. China has much to catch up in terms of improving the milk yield of its cows.
- Based in the Heilongjiang Province, our subsidiary is the largest company specialising in the production of bull semen, dairy cow embryos and raw milk in China *
* According to China Dairy Industry Association
- It is building a 150 000 tonnes raw milk processing factory. They have signed a contract to provide OEM with raw milk, As of Jan qtr report, it has installed the milk machines by early march and will commence trial production for 1 month.
- The outbreak of mad cow disease in Canada and the U.S. in 2003 knocked the North American cattle industry on its back. The largest importers of U.S. and Canadian beef, including Japan, South Korea, and China, banned the import of beef from North America. But for China Milk Products, the restrictions proved to be a blessing in disguise. The privately owned raw milk company had already purchased 970 Canadian Holstein cattle. Its state-owned rivals failed to import as many cattle because they had to navigate government bureaucracy to get bank loans. Today, China Milk owns the largest herd of Holstein cattle in China and ranks 50th in BusinessWeek's annual Hot Growth rankings of Asia companies
Any rancher wanting to breed his cows with a Canadian Holstein has to go to China Milk. The company charges its customers $9.50 per sample of bull semen from a Canadian Holstein, compared with $6.75 from Australian Holsteins and $2.70 from Chinese Holsteins. However, Chinese ranchers are still willing to pay a premium for Canadian Holsteins, especially after receiving a little help from the government.
Starting this year, the Chinese government is giving Chinese ranchers a subsidy of $2 toward each sample of bull semen.
- China consumption of dairy products is about 20kg in 2006. It is a low base compared to other countries. With a greater awareness of nourishment with drinking of milk, and better life style (ice cream/butter/ yoghurt), demand will continue to increase
- Tourism will continue to be strong after the China Olympics. With more Ang mos visiting China, they will want their daily milk, butter, pasta, yoghurt, boosting demand.
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