16/11/2012 (The Star) - Palm oil prices are expected to recover in the near term to between RM2,600 and 2,800 per tonne, driven by higher exports.

In a research note yesterday, HwangDBS Vickers said China's stricter import quality control for edible oils would commence on Jan 1 next year and palm oil imports were expected to surge in November and December this year as protective measures against supply disruptions after the new regulations were in place.

“Our expectation also accounts for seasonally-higher Indian imports and lower output,” it said.

The research house said it had upgraded its call on Wilmar International to “buy” as the market had put excessive discount on the group's performance over the next 12 months.

“We also recommended Bumitama Agri as our upstream pick for the sector, while First Resources and TSH Resources as our buy-on-weakness' picks,” it said.

Kenanga Investment Bank Bhd said it would maintain its 2012-2013 calendar year average crude palm oil (CPO) price forecasts of RM2,975-RM3,000.