Dear Friends of i3 Forum
With FCPO Crossing Rm5,000 today - the 3rd Bull Run Theme for Malaysia Home Grown Industry is now Confirmed Officially
RM5,000 is a New World Record for Palm Oil
YES! On this Memorable historic day of October 6th 2021 FCPO (Oct 2021) Finally broke through the Rm5,000 barrier into a New World Record for the world of palm oil in general and for Malaysia in particular as Malaysia is the World 2nd Exporter of Palm oil just as Medical Gloves were Malaysia's Number One Export last year.
So we have 3 Consecutive Years of Bull Run
Year 2019 : OGSE Upstream bull run when Petronas Pumped Rm30 Billions for Upstream OGSE Players
Year 2020: Coronavirus triggered panic buying of Malaysian Gloves from World wide Governments
And Year 2021: We witness Cpo prices breaking into Multi year Record Highs of Rm5,067
The Extraordinary Windfall of Glove Locked in Sale from June 2020 to June 2021 brought in ENORMOUS AMOUNTS OF PROFITS From Pre-Order, Pre-Booked & UP FRONT PRE-PAYMENT FOR GLOVES ORDERED - CAUSING A ONCE IN A LIFE TIME GLOVE SUPER BULL RUN & NOW OVER
SO THE EXTRA ORDINARY PROFITS OF SUCH HIGH RECORD CPO PRICES WILL BRING IN ENORMOUS AMOUNT OF CASH TO ALL PALM OIL COMPANIES AS WELL
AS EXPERTS HAVE NOW GIVEN BULLISH FORECAST THAT CPO PRICES ARE EXPECTED TO REMAIN ELEVATED TILL 1ST HALF OF YEAR 2022
WE CAN EXPECT RESULTS FOR
NOVEMBER 2021 TO BE EXCELLENT
(Reporting for 3 months qtr of July, August & September 2021 when Cpo averages at Rm4,417 a metric ton)
FEBRUARY 2022 RESULTS SHOULD EXCEL
(Reporting for October, November & December 2021 FFB or Fresh Fruit Bunch harvests)
Since today Oct 6 Cpo is RM5,067 the earnings will reflect such high prices
These are Exciting, Extra Ordinary Times! In those bleak times Cpo fell to as low as Rm1,700 per ton in open market leaving very slim profits in those lean years. Now no more!
WE ARE GOING INTO UNCHARTED TERITORY AS CPO HAS BREACHED THE HIGHEST PRICES OF RM4,500 PER TON IN THOSE GOOD OLD TIMES TO AN AMAZING NEW RECORD OVER RM5,000 NOW!
AND WE CAN EXPECT ALL PALM OIL COMPANIES TO BREAK OUT INTO NEW RECORDS AS WELL
Take Glove Bull Time as an Example
Calvin & friends used to see Supermax Cycle
In those times Supermax would boomed up to Rm3.00 , then split by one for one free bonus back to Rm1.50
After that the next cycle brought Supermax up to over Rm3.00 & split again
Last year we bought Supermax at Rm1.73 & expected Supermax to go till Rm3.00 & split by One for One free bonus again
But that was no ordinary Cycle.
We were totally caught by surprise! Supermax turned supersonic & powered up to Rm24.44 & only then split by One for One Free Bonus
Will there be a Big Surprise in store for all Palm Oil Stocks this Coming Bull Run Time?
Yet to be seen as "Future" is unknown
But we can "SEE" the Signs ahead & they tell us Bullish Events are Unfolding
1) China shut down its factories due to lack of electric power - leading to little Soybean milling. Without milling there won't be enough soymeal & soy oil
SO CHINA MUST BUY PALM OIL TO MEET THE SHORTFALL
2) NOVEMBER 14 is DIWALI CELEBRATION FOR INDIA's 1.35 BILLION PEOPLE
3) DECEMBER 25 IS CHRISTMAS & FOLLOWED BY NEW YEAR CELEBRATION OF YEAR 2022
Every cake, ice cream or feasting involves palm oil
4) FEBRUARY 1ST 2022: 1.4 BILLION STRONG CHINESE CELEBRATE CHINESE LUNAR NEW YEAR WITH 15 DAYS OF FEASTING - LOTS OF PALM OIL NEEDED
5) VERY COLD WINTER AHEAD: SO HIGH CRUDE OIL PRICES EXPECTED - HELPING TO KEEP PALM OIL ELEVATED AS IT IS USED AS ALTERNATE BIODISEL FOR GREEN ENERGY
6) THEN USA TURNING ITS FOSSIL FUEL REFINERY TO BIODISEL REFINERY WILL GIVE BIODISEL A SUSTAINED UP-LIFT
THESE AND OTHER MULTIPLE FUNDAMENTAL STRUCTURAL FACTORS ARE GAME CHANGERS FOR PALM OIL BULL RUN TIME
HOW LONG WILL PALM OIL BULL RUN LAST?
THAT WE CANNOT TELL
BUT IT WON'T BE FORESTALLED LIKE GLOVE DUE TO IMMENSE GLUT & THE CHINA FACTOR
ANSWER: UNLIKE GLOVE WHEN CHINA COULD SET UP NEW GLOVE FACTORIES IN JUST 4 TO 6 MONTHS YOU NEED LAND & PLANTING TIME FOR PALM OIL TO GROW TILL FIRST FRUIT : AT LEAST 5 YEARS TO SEE COMPETITION (SO PALM OIL HAS HIGH TIME BARRIER TO ENTRY TILL YEAR 2026)
WILL PALM OIL BULL RUN LAST TILL YEAR 2026?
AGAIN THAT WE CANNOT SAY FOR SURE
BUT THIS IS SURE
THE PALM OIL BULL IS STILL A VERY YOUNG BULL
AND IT STILL GOT TIME TO GROW UP INTO A FULL BLOWN MATURED BULL
SO BETTER TAKE POSITION NOW AND DON'T MISS THE BULL RUN YET AHEAD
Please buy or sell after doing your own due diligence or in doubt go find Expert Counsel for Your Investment Safety
Latest Good News!
*Good afternoon from RHB Plantations Team!*
*CPO one month futures shot past MYR5,000/tonne*
♦️ *What should investors do?*Ride the wave. This is practically one of the first times this year that share prices are moving in tandem with CPO prices. For investors who have been waiting for this sector to do something all year, now is the time to ride the wave and wait for a good opportunity to lock in some profits.
♦️ *Can this rally last?* There was no fundamental change that happened over the last few days to trigger this sudden spike. Plantation monthly stats due to come out next week are likely to show a reduction in stocks on the back of improved exports, however the reduction is expected to be minimal, therefore insignificant. We believe this jump above MYR5,000 may be short lived as we continue to expect next year's fundamentals of supply to improve, with a moderation of CPO prices in 2022. Main risk to this thesis is weather abnormalities.
♦️ *If I want to partake in the rally, what should I BUY?* We would recommend liquid big cap names like Sime and IOI. Sensitivity to CPO price movement may not be as significant as the smaller cap names, but liquidity is there so that investors are able to be nimble.
♦️ *Any change to our UW sector call?* Not at this moment. Our call is a 12 month call, and we still believe in the wake of improving fundamentals and moderating prices in 2022, earnings will be weaker YoY, while ESG concerns will still have a part to play in valuations of the sector as a whole. We continue to like the smaller cap names like SOP and Ta Ann in Malaysia, integrated players like First Resources and Wilmar in Singapore and London Sumatra In Indonesia.
♦️ *RHB Research*
Note: We continue to like the smaller cap names like SOP and Ta Ann in Malaysia,
RHB RESEACH IS SMART & CLEVER TO CHOOSE THESE TWO EXCELLENT ONES
SOP (SARAWAK OIL PALM) Calvin's Target Price one year: RM8.00
TA ANN (GREAT PEACE) Target Price Rm6.00
Created by calvintaneng | Sep 26, 2023
Created by calvintaneng | Sep 20, 2023
Created by calvintaneng | Sep 11, 2023
Created by calvintaneng | Sep 07, 2023