AmResearch kept its neutral rating on the Malaysian plantation sector but said vegetable oil prices including palm oil will get a temporary boost from Argentine port strikes.

The Malaysian plantation sector is dominated by Sime Darby, IOI Corp and Kuala Lumpur Kepong.

'If the workers strikes take place for only a few weeks, then there would be no impact on the exports of grains and oilseeds like soybean. However, if the strikes were to continue for an indefinite period, then this would not be positive as agriculturalproducts would be stuck at the ports,' said AmResearch.

According to last week's Chicago Mercantile Exchange report, Argentine grainport inspectors may be launching a strike today due to discontentment over wages.

If this happens, then it would be the second time Argentine port workers are going onstrike. The first strike took place in April this year and ended when workers receivedwage increases of below 25 per cent.

Major consumers like China may have to switch to soybean from Brazil or the US. The US supplied about 55 per cent of China's soybean in April.

'If the workers strikes result in lower supply of soybean in the world market, then thisis positive for vegetable oil prices. However, we reckon that the strikes would not bedragged for long as the soybean harvest in Argentina is almost completed,' said AmResearch.

Although demand for soybean from Argentina is expected to be positive, demand for the country's soybean oil may not be favourable as China has imposed import controls. This follows a trade dispute with Argentina, which imposed anti-dumping duties on Chinese goods like steel. -- Reuters