SD Guthrie sees higher palm oil prices offsetting rising costs, says CIMB Securities
17/03/2026 (New Straits Times), Kuala Lumpur - SD Guthrie Bhd is optimistic that higher crude palm oil (CPO) prices will more than offset rising costs should energy prices remain at current elevated levels amid a prolonged US-Iran conflict, said CIMB Securities Sdn Bhd.
The firm said the group sees a significant rise in diesel prices at its Papua New Guinea operations and some delays in palm oil shipments to the Middle East, although its exposure to the Middle East region is limited.
"SD Guthrie added that fertiliser costs have already been locked in for 2026, and discussions are ongoing with suppliers to ensure timely delivery," it said.
Fertiliser accounts for about 27–28 per cent of direct costs, while diesel makes up less than five per cent.
However, the group cautioned that its operations in Indonesia and Papua could be affected if diesel supply is disrupted in a prolonged conflict.
"That said, management believes the impact is likely to be more than offset by higher CPO prices, as elevated energy prices could prompt major palm oil-producing countries to increase biodiesel mandates to enhance energy security, thereby supporting palm oil demand", added CIMB Securities.
SD Guthries also updated that it has forward sold 42 per cent of its Malaysian palm oil production at a CPO price of RM4,400 per tonne.
The firm kept its "Hold" call on the stock.