Higher ASP results in margin expansion for Sarawak Oil Palms

According to RHB Research, Sarawak Oil Palms will be expanding its refinery capacity by 53% to 2,300 tonnes per day at a cost of RM40mil to be completed in the second half of this year, as the plantation company’s refinery utilisation rate remains close to 90%.

PETALING JAYA: High average selling prices (ASP) of crude oil palm (CPO) have resulted in margin expansion for Sarawak Oil Palms Bhd’s downstream businesss.

According to RHB Research, Sarawak Oil Palms will be expanding its refinery capacity by 53% to 2,300 tonnes per day at a cost of RM40mil to be completed in the second half of this year, as the plantation company’s refinery utilisation rate remains close to 90%.

“The management is of the view that prices of CPO would remain elevated in the first half of this year, followed by a decline in the second half of this year if cropping patterns improve and if there is any change in biodiesel mandates globally,” said the research house in a report.