PETALING JAYA: The plantation sector is entering a more constructive phase amid stronger crude palm oil (CPO) prices, supported by strengthening biodiesel demand, improving industry economics and tightening supply dynamics, says TA Research.
In particular, rising crude oil prices has enhanced biodiesel competitiveness, reinforcing policy support in key producing countries such as Indonesia and underpinning incremental demand for palm oil.
The research house in a note to clients said rising freight costs amid ongoing geopolitical tensions could further enhance palm oil’s relative competitiveness against soybean oil.
Given palm oil’s proximity to key importing markets such as India and China, TA Research said the commodity enjoys a logistical advantage, while longer-haul soybean oil shipments face higher landed costs.
...