MARKET DEVELOPMENT
Affin Hwang Revises 2017, 2018 Forecasts Amid Tight Supply, Weak Ringgit
Affin Hwang Revises 2017, 2018 Forecasts Amid Tight Supply, Weak Ringgit
07/02/2017 (New Straits Times) - Affin Hwang Capital Research has revised upwards its average crude palm oil (CPO) price forecast to RM2,600 per tonne from RM2,400 per tonne for this year and next year.
The revision came amid tight global supply and weakness in the ringgit.
The research house said it saw the current uptrend in CPO prices as positive for plantation players but pointed out that there were moderating factors to the commodity’s price.
It said these factors included a recovery in CPO production, strengthening of the ringgit and narrower soyabean premium.
“We think prices may stay high in the first quarter of this year as supply remains tight but CPO production could improve from the second quarter onwards, putting pressure on prices,” said Affin Hwang in a note.
The revision came amid tight global supply and weakness in the ringgit.
The research house said it saw the current uptrend in CPO prices as positive for plantation players but pointed out that there were moderating factors to the commodity’s price.
It said these factors included a recovery in CPO production, strengthening of the ringgit and narrower soyabean premium.
“We think prices may stay high in the first quarter of this year as supply remains tight but CPO production could improve from the second quarter onwards, putting pressure on prices,” said Affin Hwang in a note.