Determinants of entry into Malaysian palm oil refinery industry
The palm oil refinery industry continued to rise as Malaysia’s key trade, following the nation’s transitional economy in the early 1970s. Known as the workhorse of its industry, palm oil refinery began to boom with the early establishment of refineries in several states throughout east and west Ma...
| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
| Published: |
Penerbit Universiti Kebangsaan Malaysia
2018
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| Online Access: | http://journalarticle.ukm.my/19805/ http://journalarticle.ukm.my/19805/1/jeko_522-17.pdf |
| Summary: | The palm oil refinery industry continued to rise as Malaysia’s key trade, following the nation’s transitional economy in
the early 1970s. Known as the workhorse of its industry, palm oil refinery began to boom with the early establishment
of refineries in several states throughout east and west Malaysia. However, in recent years, it was reported that the
establishment of licensed refineries in the country recorded a rise in numbers, and yet the companies did not step up
into the market as planned. The issue of industrial competitiveness was put into question by the decreasing rate of
new entrants. In this study, the logit model was adopted to identify entry-related factors in the industry. The prescribed
period of study was set between 2005 and 2013, involving 52 firms in operation in the Malaysian palm oil refining
industry, where their annual reports were obtained from the Companies Commission of Malaysia (CCM). The empirical
results implied that profit, distribution, marketing intensity, coupled with minimum efficient scale and growth were all
significant and carried the correct coefficient signs. |
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