Surge in prices: A farmer sprinkles chemical fertiliser on a crop of finger millet on the outskirts of Bangalore in India. Rising fertiliser costs due to supply constraints will impact CPO prices. — AFP
WHILE crude palm oil (CPO) prices hit a record high on Wednesday, with three-month futures prices closing at RM5,015 per tonne, market analysts still expect CPO prices and plantation earnings to decline in 2022.
UOB Kay Hian Research maintains its “underweight” rating on the plantation sector, and expressed its concern over the sustainability of the current demand as the inventory in India and China has been replenished. The research unit is keeping its CPO price forecast for 2021 and 2022 at RM3,300 and RM2,800 per tonne respectively, but sees upside potential due to tight global edible oil supplies while demand is still relatively stable despite high prices.
