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Company Reports

30 August 2024

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Palm Oil Weekly (30 August 2024): CPO MYR 4,075(+2.5% WoW)

  • Between 26-30 August 2024, CPO prices rose +2.5% WoW, averaging MYR 4,034/MT, driven by concerns over supplies from the world’s leading CPO producers (Indonesia and Malaysia) and strong demand from top importers.
  • According to GAPKI, Indonesia’s 2024 CPO output is to remain flat or down slightly from 2023 levels (-5% YoY) due to dry weather. Malaysia is also facing supply issues due to aging plantations (avg age: 11.4 year) and labor shortage.
  • On consumption, we expect stronger demand in the coming months from India and China, two of the world’s largest CPO importers. Historically, India’s cooking oil usage rises in September - November on several religious festivals, including Diwali. Meanwhile, Chinese importers have secured some cargoes for December delivery as the country plans to increase its CPO stockpile due to seasonality.
  • At this stage, we retain our FY24 average forecast at MYR 4,100/MT (YTD: MYR 3,990/MT) with NSSS (TP IDR 265/sh) and TAPG (TP IDR 800/sh) as our top picks, supported by their relatively young plantation profiles (<10 years old), which should translate to higher crop and extraction yields.

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CPO - 30 August 2024

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CPO - 30 August 2024

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