Malaysia News: Maybank IB sees boost for CPO prices

Soyaoil's premium to crude palm oil (CPO) has widened and this should encouraged substitution from soyaoil to palm oil, according to Maybank Investment Bank (Maybank IB). “If the US crop conditions worsen in the coming two-three weeks, there will be further upside to soyaoil, which might lift CPO prices as well,” it said in a research note yesterday.

It said while soyaoil price had further upside should soyabean crop prospects worsened, palm oil's discount to soyaoil was likely to stay high given that upcoming high production months for palm oil.
Maybank IB said according to the US Department of Agriculture, the US soyabean crop conditions had worsened for the seventh consecutive week. “Crop conditions for soyabeans had declined to their lowest since 1988, with only 31% of planted area nationwide rated good or excellent' and 35% rated poor or very poor',” it said.

Refined palm oil storage tanks Johor. Maybank IB says if the US crop conditions worsen, CPO prices may be lifted.

 

 

 

Maybank IB has maintained its average selling price forecast for the commodity at RM3,150 per tonne for this year and RM3,000 per tonne for 2013-14.

It has also maintained its “neutral” call on the palm oil sector over the next 12 months. (Bernama)