PETALING JAYA: Boustead Plantations Bhd
anticipates crude palm oil (CPO) prices to be bullish by 2020, ranging from a conservative outlook of between RM2,200 and RM2,300 per tonne.
This is supported by vegetable oil shortage in 2020 that will see increased demand for CPO.
Chief executive officer Chow Kok Choy said CPO competitor soybean would experience shortage due to planting in the next 12 months, affecting vegetable oil and increasing demand for CPO.
“The US-China trade war will hopefully be resolved by then and spur economic growth, leading to better oil consumption,” he told reporters after the company’s annual general meeting, here today.
In the near term, he said prices would go sideways due to the non-conclusive US-China trade war that would affect commodity prices.
Meanwhile, in the medium term, Chow said China, one of the largest consuming countries for CPO, would face African swine fever issues that would slow down soybean demand.
“China has a huge palm oil intake of 2.4 million tonnes. A discount on soybean to CPO, would narrow parity and CPO prices would not drop in the medium term,” he said.
Boustead Plantations Bhd is involved in the upstream CPO chain, dealing with fresh fruit bunches. - Bernama