Hi CCWONG, I fully agree with you that the strong fundamentals of CPO remain intact.
Although Oct closing stock went up 4.42% to 1.83 mil MT, the inventory is merely 1.2 month buffer stock ((1.83/18.0)x12 ) which is very low for a food, industrial and biofuel products. The ‘comfortable’ inventory level may be about 3 to 3.2 mil mt in order safely meet the growing usage as edible oil and renewable biofuels .
Seasonally low production period start this month until March 2022. The closing inventory until March 2022 or beyond likely to stay tight and thus support CPO price at high level for awhile. This probably explains why CPO price for Nov went up $119 despite 4.42% increase in inventory.
Fund managers and Analysts may continue to forecast higher production/stock into 2022 and forecast substantially lower CPO in next year (anyway, they have never got it right in the past 12 months). I think they will get it wrong again.
Overall CPO production next year will still be about the same as this year. Because of MCOs (hampering delivery of fertilizer) and labour shortage , fertilizer application this year is seriously delayed and shall adversely affect FFB yield next year . Field upkeep is not up to the mark .
Labour shortage will still be a problem with covid resurgence as high risk . Fertilizer application for 1H next year will face another setback due to extremely tight supply of certain essential fertilizer from China. Under such scenarios, how can the palms yield more next
year ?? I have my reservations.

Hi Danny123, CPO closed up $119 to $5,379 for spot month, this is more than erasing all the loss of $69 yesterday. Daily price fluctuations is very normal. No need to trigger alarm when it drop the next time.

KYY dumping after he failed to lure buyers ??

Ya , AYS dropped 11.5% in the morning session. KYY must be very angry .

@kon, income tax refund will reduce the amount of tax payable this year and hence increase profit.
But GST refund is just squaring off the difference in GST input tax accounts with output tax accounts Hence it has no impact on earning.

@Intrinsic99, No need to have suspicious mind and over react .For whatever we post ,viewers will use their intelligence to judge whether they are valid or bullshit . Just sell and stay out if you think owning this stock is a mistake.

The analyst with IBs tends to bullshit and said things with motives. Better ignore them.

@Kon, GST refund is a balance sheet item and therefore is not a profit. It increases cashflow for the company.
I think NPAT for Q3 will come in around $77 mil or 3.45 sen/share.
Yes, I think there will be MAXIMUM dividend payout from the qtr earning simply because Bstead Holdings (parent company) need the cash urgently to pare down debts. Afterall, Bplant has strong cash flow from operations, GST refund and net proceed of $430mil from Kulai estate impending disposal.

Why need to panic ? Price correction is very normal after price surged to historical high . CPO closed down $69 or 1.3% only for spot month. Price for spot month is still highly lucrative at $5,260.

Danny123, No need to panic lah. CPO closed down only $69 or 1.3% for spot month. Price for spot month is still lucratively high at $5,260!

I picked up 110,000 share at 66.5 sen this afternoon. Sellers are welcome to dump it cheaper and create good buying opportunity for investors who understand oil palm business.

Managed pick up 150, 000 share at 65.5 to 66 sen this afternoon.

Taann and SOP are both very well managed plantantion companies. You don't have to worry for irregularity.

Per qtr report , average realized CPO price for Malaysia during jul - Sept 2021 was only $3,085 which is far below the average spot prices for the qtr of $4,450!!! UP must have sold the crop forward .
That explains why UP 's 2021 results is unsatisfactory despite substantially higher CPO price in current year .

I added some at $3.06 though not that many sellers at this price.

In view of potential privatization and robust CPO price I have no worry to pick up 300,000 share at 66 to 67 sen today.

But you are not exactly comparing the windfall tax sum between the old and the new system which involves both higher rate and higher threshold price . The positive impact of the threshold price increase from $3,000 to $3,500 is not being considered by you .

I see your point . The FFB production figures of 350,000 mt initially assumed was wrong .
Based on FY 2020 FFB production of 710,000 mt and average CPO price of $4,500 , the revised calculations are :
Full year Windfall tax at existing rate : 1.5% x 710,000x (4,500-3,000) = $15,975,000
Full yearn Windfall tax at new rate : 3% x 710,000 x (4,500 - 3500) =$21,300,000
The difference is $5,325,000 .

Can you share your calculations how you arrived at $10.65 mil?

@treasurehunt, pls don’t confuse yourself.
Windfall tax rate of 1.5% for East Malaysia and the new rate of 3% is levied on FFB production basis .
If you want to convert the calculation to CPO basis , both the tax rate and the production volume has to be converted to CPO basis.(350,000mt FFB =70,000 mt CPO )
The comparison between the old and new rates are correct per imy post on 1/11/21.

KUALA LUMPUR (Nov 8): Foreign buying of Malaysian equities extended for the fifth week and jumped to RM67.94 million last week from RM1.44 million the prior week.

In its weekly fund flow report on Monday (Nov 8), the MIDF Research team said as the market reopened last Monday, local institutions and retailers were net sellers and net buyers respectively, amounting to RM329.7 million and RM314.3 million.

“Meanwhile, foreign investors were net buyers to the tune of RM14.97 million despite sentiment turning negative following the announcement of the one-off “Cukai Makmur”

It seem to me that foreign investors have better understanding to what extent Cukai markmur impact corporate profitability than the local institutions. The local analysts from various IBs painted so much negativity and with exaggeration . They are the real problems to our capital market.

KUALA LUMPUR (Nov 8): Foreign buying of Malaysian equities extended for the fifth week and jumped to RM67.94 million last week from RM1.44 million the prior week.

In its weekly fund flow report on Monday (Nov 8), the MIDF Research team said as the market reopened last Monday, local institutions and retailers were net sellers and net buyers respectively, amounting to RM329.7 million and RM314.3 million.

“Meanwhile, foreign investors were net buyers to the tune of RM14.97 million despite sentiment turning negative following the announcement of the one-off “Cukai Makmur”

It seem to me that foreign investors have better understanding to what extent Cukai markmur impact corporate profitability than the local institutions. The local analysts from various IBs painted so much negativity and with exaggeration . They are the real problems to our capital market.

KUALA LUMPUR (Nov 8): Foreign buying of Malaysian equities extended for the fifth week and jumped to RM67.94 million last week from RM1.44 million the prior week.

In its weekly fund flow report on Monday (Nov 8), the MIDF Research team said as the market reopened last Monday, local institutions and retailers were net sellers and net buyers respectively, amounting to RM329.7 million and RM314.3 million.

“Meanwhile, foreign investors were net buyers to the tune of RM14.97 million despite sentiment turning negative following the announcement of the one-off “Cukai Makmur”

It seem to me that foreign investors have better understanding to what extent Cukai markmur impact corporate profitability than the local institutions. The local analysts from various IBs painted so much negativity and with exaggeration . They are the real problems to our capital market.

Seem to me that foreign investors have better understanding to what extent Cukai markur has on corporate profitability than the local institutions. Local analysts from various IBs painted the picture so negatively and with so much exaggeration. They are the real problems to our capital market.

KUALA LUMPUR (Nov 8): Foreign buying of Malaysian equities extended for the fifth week and jumped to RM67.94 million last week from RM1.44 million the prior week.

In its weekly fund flow report on Monday (Nov 8), the MIDF Research team said as the market reopened last Monday, local institutions and retailers were net sellers and net buyers respectively, amounting to RM329.7 million and RM314.3 million.

“Meanwhile, foreign investors were net buyers to the tune of RM14.97 million despite sentiment turning negative following the announcement of the one-off “Cukai Makmur”

@Rambutan9, thanks for the compliment.

In the news that LTAT intends to sell its 35.17% direct stake in Affin Bank . Not sure if that also involve Bstead’s 20.38% stake in the bank .

Just check the series of analyst reports on CPO since early 2020. It is very easy to form your own opinion how reliable and professional they are . They have been in denial mode .

@greeland, thank you for your support. I am just sharing a bit of my knowledge thru my 30 years close association in this industry . Let’s be happy investing in the new dynamics of this wonderful oil crop that the world can not live without. Climate change and ESG pressure shall only drive CPO to a new normal high . This is because there is NO ‘environmentally friendlier’ and cheaper substitutes for CPO which are so widely used as edible oil ,in household products and as renewable fuel.
CPO production in Malaysia and Indonesia isn’t going to increase next year due to lack of new investment and slow replanting in the past 3 years . The delayed and lower fertilizer application rate in 2021 and 2022 will further limit yield . Many analysts mistakenly treat CPO like an industrial product manufactured in the factories that can be switched to higher gear in a short time . They are so wrong .

Intrinsic99, the analysts and fund managers have never got it right for CPO in the past 2 years . The have no in-depth knowledge and experience in the sector . They do their work from the computer desktop in the office and misled investors by their unprofessional advise. Don’t have to take their words seriously.

Endgame, pls sell more . I am happy to buy yours too.

PALM OIL VERSUS OTHER CROPS
Land required to produce 1 ton of oil

Sunflower
1.43 ha
Rapeseed
1.25 ha
Soybean
2 ha
Palm oil
0.25 ha
10 times more land than palm oil per 1 ton of oil
Source: UN Food and Agriculture Organization (FAO)
Even environmentalists admit that boycotting palm oil may be even worse for the planet. That’s because palm oil is up to 10 times more productive than rapeseed, soybean or sunflower oils. Oil palms cover only about 7% of the world’s arable land but produce 40% of its vegetable oil. Replacing palm oil with an alternative would require the cultivation of a lot more land.

This appear in today’s Bloomberg’s report:

PALM OIL VERSUS OTHER CROPS
Land required to produce 1 ton of oil

Sunflower
1.43 ha
Rapeseed
1.25 ha
Soybean
2 ha
Palm oil
0.25 ha
10 times more land than palm oil per 1 ton of oil
Source: UN Food and Agriculture Organization (FAO)
Even environmentalists admit that boycotting palm oil may be even worse for the planet. That’s because palm oil is up to 10 times more productive than rapeseed, soybean or sunflower oils. Oil palms cover only about 7% of the world’s arable land but produce 40% of its vegetable oil. Replacing palm oil with an alternative would require the cultivation of a lot more land.

Below appear in Bloomberg report :

PALM OIL VERSUS OTHER CROPS
Land required to produce 1 ton of oil

Sunflower
1.43 ha
Rapeseed
1.25 ha
Soybean
2 ha
Palm oil
0.25 ha
10 times more land than palm oil per 1 ton of oil
Source: UN Food and Agriculture Organization (FAO)

Even environmentalists admit that boycotting palm oil may be even worse for the planet. That’s because palm oil is up to 10 times more productive than rapeseed, soybean or sunflower oils. Oil palms cover only about 7% of the world’s arable land but produce 40% of its vegetable oil. Replacing palm oil with an alternative would require the cultivation of a lot more land.

Danny123 should read and understand my post on 2nd Nov . I have no worry at all of CPO to correct below $5,000. Afterall, the average CPO price between 2008 to 2020 was only $2,635

Since when had fund managers been bullish on CPO ?? Not that I know of . They never expect CPO to even crossed $3,000 since Dec 2019 ,ie almost 2 years ago. Every time CPO broke new highs they would say price not sustainable and would fall back to $2,500-2,700 and same story has be going for almost 2 years

Since when had fund managers been bullish on CPO ?? Not that I know of . They never expect CPO to even crossed $3,000 since Dec 2019 ,ie almost 2 years ago. Every time CPO broke new highs they would say price not sustainable and would fall back to $2,500-2,700 and same story has be going on for almost 2 years . Lol .

Agriculture products like CPO are not produced in factories like gloves. There is huge difference in the economics and market dynamics between the 2.

Agriculture products like CPO are not produced in factories like gloves. There is huge difference between the economics and market dynamics between the 2.

This may also explain why CPO is holding well above $5,000 pmt and shall stay elevated into 2022.
CPO for food as well as for fuel (biodiesel) , seem to be the beneficiary of food and energy crisis until energy cost come down significantly. Will energy cost fall significantly soon ? Amid climate change target to meet , investors activism against global oil &gas companies operations, financing limitation by banks and lack of investment , energy supply and price will not ease anytime soon.

https://finance.yahoo.com/news/going-food-crisis-energy-crunch-090255366.html

This may also explain why CPO is holding well above $5,000 pmt and shall stay elevated into 2022.
CPO for food as well as for fuel (biodiesel) , seem to be the beneficiary of food and energy crisis until energy cost come down significantly. Will energy cost fall significantly soon ? Amid climate change target to meet , investors activism against global oil &gas companies operations, financing limitation by banks and lack of investment , energy supply and price will not ease anytime soon.

https://finance.yahoo.com/news/going-food-crisis-energy-crunch-090255366.html

https://finance.yahoo.com/news/going-food-crisis-energy-crunch-090255366.html
This may also explain why CPO is holding well above $5,000 pmt and shall stay elevated into 2022.
CPO for food as well as for fuel (biodiesel) , seem to be the beneficiary of food and energy crisis until energy cost come down significantly. Will energy cost fall significantly soon ? Amid climate change target to meet , investors activism against global oil &gas companies operations, financing limitation by banks and lack of investment , energy supply and price will not ease anytime soon.

Substantially lower input costs like coal and iron ore coupled with softer demand in China itself are development to be concerned.

He is looking for buyers for his AYS holding.

CPO counters at historical high level ??
This fellow tell lies with his eyes wide open!
Investors just need to look into each of the plantation’s performance for H1 2021 and some has just reported Q3 EPS vis a vis their share price to know the truth . I am surprised he is willing to go down so low to tell lies .

you can hardly trust the analyst !

Opec refuse to pump more oil amid climate change pressure from the west. Bankers /financiers refuse to lend to oil companies. Investors activists threatened the Board of oil companies. Where are we going to get more supplies to ease price? I think oil price will stay above $80 for years.

The quality of the analyst's report has gone down so low. Where's the professionalism ?

Anyone still believe in him ?