,According to RHB Research, the crude palm oil (CPO) prices and share prices of most planters have also fallen after the lifting of Indonesia’s palm oil export ban on May 23.USDT交易所程序出租（点击联系我）,全球頂尖的USDT場外擔保交易平臺程序出租。
PETALING JAYA: Investors should consider adopting a profit-taking strategy on the plantation sector, given continued uncertainties on the impact of Indonesia’s domestic market obligation (DMO) policy and the recent change in its tax structure.
According to RHB Research, the crude palm oil (CPO) prices and share prices of most planters have also fallen after the lifting of Indonesia’s palm oil export ban on May 23.
The research house, which maintained a “neutral” call on the sector, said: “We advocate a profit-taking strategy, given the continued uncertainty on the DMO policy impact in Indonesia.
“The special US$200 (RM883) per tonne tax to get a DMO exemption would be punishing on the industry players in Indonesia as it will be difficult to obtain the necessary export permits to export their products.”
The recent first quarter of 2022 (1Q22) reporting season also saw most planters booking results that beat expectations on the leveraged impact of higher CPO prices, said RHB Research in its latest report.
Most planters in Malaysia are expecting production to recover further in the second half of 2022 (2H22) by a mid-to-high single-digit growth, while most planters in Indonesia are expecting mid-single-digit growth due to the high base effect in 2021, it added.
“There could be a pick-up in forward-selling activities for the rest of 2022, as planters are nervous about the sustainability of high prices and the impact Indonesian trade policies will have on prices,” the research house noted.
Despite the lifting of Indonesia’s palm oil export ban, RHB Research believed that exports from Malaysia would not fall significantly in June, given the logistics issues faced in Indonesia currently, as well as the difficulty in obtaining export permits.
Palm oil stock levels could, therefore, remain low in June, and only pick up from July, it added.
CGS-CIMB Research, meanwhile, said higher palm oil supply could likely lower CPO price in 2H22.
“We project palm oil stock to rise by 5.1% month-on-month to 1.6 million tonnes by end-June 2022, on higher output and lower exports.
“We believe CPO prices could trade in the range of RM5,500 to RM6,500 per tonne this month due to the uncertain export supply of sunflower oil from Ukraine and lower-than-usual palm oil export supply from Indonesia as the country tweaks its export policies on palm oil to secure domestic cooking oil supply,” it said in its latest report.
The research house also maintained its average CPO price forecasts at RM5,600 per tonne for this year and RM3,800 per tonne for 2023 respectively.
“We believe weaker 2H22 CPO prices, coupled with higher operating costs due to the hike in the minimum wage in Malaysia to RM1,500 per month effective May 1, higher fertiliser costs as well as the Cukai Makmur tax will lead to lower profit margins in 2H22, unless productivity improves,” it pointed out.