Interest in plantation stocks surge anew

Rising global demand and a decline in inventories have pushed crude palm oil prices higher and rekindled interest in Malaysian plantation stocks. Businessmen remain bullish on prices, which could remain between 2,600 ringgit (US$722.50) and 2,800 ringgit (US$778.07) per ton for the rest of the year. According to media reports, analysts forecast a rate of 2,500 ringgit (US$694.71) per ton for 2009 and see a v-shaped market recovery, emphasizing that global markets are on the verge of a major reversal. One factor that would help with improvement is high demand coupled with lower production, which has led to sharply falling inventories. Other factors propelling the rise in prices include a less sturdy U.S. dollar and consumers’ switch to biofuels. (March 23/ April 14, 2009)