MIMB
Investment Bank expects the plantation sector to become more positive
in the coming months with crude palm oil prices fast approaching the
RM3,000 per tonne mark.
CPO has rallied 15 per cent in the past six months amid optimism
that demand will increase in Asia and on concerns excess rain will
disrupt output in Malaysia, said MIMB Investment Bank in a research note
today.
“We like small- to mid-side plantation counters that trade at a discount compared with the industry average,” it said.
As at September, CPO was traded at an average of RM2,719 due to a 2.68 per cent drop in production month-on-month.
Yesterday, CPO prices for October closed at RM2,916 per tonne.
MIMB also said Malaysia’s palm oil exports are expected to reach
RM65.2 billion this year from RM49.5 billion last year, with increased
demand being viewed as a cheaper alternative to cooking oil compared
with soy oil.
To date, the discount between CPO and soy oil has widened in
comparison to around US$180 per tonne from US$157 per tonne last month.
— Bernama
Source : Business Times
