THE INVESTMENT APPROACH OF CALVIN TAN
Why Palm oil Bull Run is not Game Over like Gloves? After the pullback it Shall Rebound Up Again, Calvin Tan
calvintaneng
Publish date: Sat, 02 Jul 2022, 04:38 PM
calvintaneng
0 1,791
Hi Guys,
I have An Investment Approach I which I would like to all.
I have An Investment Approach I which I would like to all.
Dear Investors
Many thought Palm oil bull run will end abruptly like Glove
No! No! No!
Definitely No!
We give you the Reasons why
1) GLOVES ARE MAN MADE WHILE PALM OIL GROWS BY NATURE
After China heard of the great success story of new glove bilionaires China decided to build multiple New Glove Factories in no time (China could built 1,000 Bed hospitals in 10 days)
As a result the World is in total Glut with gloves - leading to fierce price war & price under cutting
From Glove ASP premium to Glove ASP discount
From Huge Profits to Horrendous Losses
2) PALM OIL NEEDS AT LEAST 5 YEARS FROM PLANTING TO 1ST DROP OF COOKING OIL
So there is HIGH TIME BARRIER!
And each day has only 12 hour sunshine. Glove factories do not need sunshine as they could be produced 24 hours non stop by robots
That is why Palm oil Bull Run will last much much longer
3) THE FACTORS THAT PUSHED UP PALM OIL PRICES ARE MANY
Ukraine cannot export its sunflower oil due to port blockage. Its stores being full have no more space for newly harvested grains. Its farmers also cannot plant for next year as they are in financial ruin
3 years of Deficit in Sunflower oil can be expected. So prices will remain high. And by proxy Palm oil cannot fall too low
Canada experienced its worst drought in 2021.
Till now Canola oil prices very high & currently Canadian farmers have planted less Canola crop by 7%
By year end we will know if the 93% planted will succeed
In USA High Brent Oil prices over USD100 to USD110 turning many to use soybean as biofuel
So demand for soybean both as food & fuel will be up
Same goes for Indonesia
High Oil Prices cause them to use 35% instead of 30% Cpo as biofuel
All these Competing Oils are in trouble & prices remain elevated. So palm oil will see support
4) MALAYSIA & INDONEIA BANNED CONVERSION OF FOREST TO NEW PALM OIL ESTATES SINCE 2018
Last 4 years World population continues to grow by 80 Million per year (1% of 8 Billion people on earth)
That is 320 Millions about the Population of USA
And every year 80 Millions more babies will be born
OVER A PRO-LONGED PERIOD DEMAND WILL FAR EXCEEDS SUPPLY
PALM OIL PRICES MUST GO UP
Regards
Calvin
More articles on THE INVESTMENT APPROACH OF CALVIN TAN
Rimbunan Sawit to beef up crop production and yield, By JACK WONG (Calvin Tan comments)
Created by calvintaneng | Apr 06, 2024
Discussions
1 person likes this. Showing 25 of 25 comments
dear sifu CALVIN of west jurong SIN, pls buy n buy n buy more.,. n pls report to us all.,. ur behavior n character thereafter then .,. PLS.,.
2022-07-02 17:16
Word is out
Cpo expected to range Rm4500 to Rm5000
as cost of cpo production Rm2000 to Rm2500 profit can still be a decent 75% to 100%
very good in these recessionary times when most businesses cannot even generate 20% profit out there
From high cash profits palm oil shares like Bplant, taann, hs plant and later followed by all others can still give out 7% to 12% dividend which is far better than bonds or bank Fd anytime
2022-07-03 21:51
Palm oil factory stop temporary due to dropping prices may added to the situations
2022-07-04 11:23
those pure mills only will see difficult times short term
integrated ones from upstream, midstream and downstream like
Simedarby plant
Ioi corp
Sop
Tsh resources
all ok
2022-07-04 11:31
Actual reason is this lah
https://www.tradingview.com/chart/S4D6TuVJ/?symbol=AMEX%3ADBA
2022-07-04 12:53
traders?
no
no short term trading
stay invested in Value
Palm oil got real profits
Real cash inflow that clears debt
Real profits that translate to high cash payout and good dividends
2022-07-04 13:01
One defensive quality of palm oil now with Cpo over Rm4000
Since palm oil is not lumpy in sale it is able to generate good cash flow
At Rm4500 per ton with cost average Rm2250 the profit is a very decent 100%
This will help pare down borrowings
And then the coffers of palm oil co will overflow in Cash
From there lots and lots of dividend streams will be given
2022-07-04 14:18
dividend from bplant just given 7.3 sen
by Aug 2022
bplant should be giving another 3 to 4 sen dividend as well as Cpo prices high and Ffb yield good
anything 5 sen and above dividend will be a bonus
2022-07-04 14:39
hs plant already given 15.5 sen + 1.5 sen = 17 sen total dividends
last two qtr profits were 11 sen and 12 sen
Average up year total profit will be 45 to 46 sen
since Hs plant dividend payout is 60% the total expected dividend will be 27 sen
less 17 sen we already received there might be another 10 sen dividend from HS plant this Aug 2022
2022-07-04 14:43
another super dividend paying stock is Taann
Ffb for April to May collected is almost 80% of 3 months total from Jan to March 2022
and April - May witnessed very high Cpo prices
So Aug 2022 Taann results should also be excellent
another record earnings plus A Nice Dividend
2022-07-04 14:45
SOP another fantastic super earning palm oil stock
last qtr profit 34.09 sen and it's p/e now at a 2.99 low
Plus for the very 1st time SOP gave a 4 sen first interim dividend
now we just received another 6 sen dividend
next is free one bonus for two by July 15
with latest Ffb up at 91,000 tonnes plus high Cpo prices the results for Aug 2022 will be excellent
2022-07-04 14:49
Towering over all as World Champion is Simedarby plant with 3.3 Million acres of palm oil
fully integrated palm oil co capturing upstream, midstream and downstream operations
No wonder Kwap bought 1 million simedarby plant shares today
2022-07-04 14:52
Palm Oil will trade below RM 2000 in a couple of years.
No prospect of rising.
2022-07-04 19:25
hmmm? yes ah?
last time long ago Teh tarik was only 10 sen in the 1960s
but by 1990s teh tarik price gone up to Rm1.00 a glass
lately teh tarik has more than doubled to Rm2.20
so will teh tarik drop back to Rm1.00 soon?
and longer term teh tarik drop back to the price of 10 sen
Yes.
in your dream
2022-07-04 19:43
Prudent consumer will exercise their rights and stop drinking.
Consumer rights is also part of financial management.
Just buy tea leaf and make your own teh tarik.
If lazy to do then burn out loh!
Until 1980s people were bringing their own food from home.
We regress back when things are out of reach.
Exercise consumer rights.
2022-07-04 19:54
Bull Eun or not , it doesn't matter, all stock price will drop until lao sai from now till end of the year
2022-07-04 20:02
I see
got such thinker
yes better go tongsan plant own tea then
and bull or not Palm oil will be earnings $$$ to pay High dividends $$$
2022-07-04 20:09
How long could 75-100% be sustainable? it's kinda hard to imagine that to sustain on commodity.
Also if we factor in rising cost of fertilizer and labour squeeze, what's the real margin for plantation companies?
during pandemic, gloves company orderbook stack up 1 year ahead with prepaid payments, Does the Palm oil company experience such? If the mill has stop taking in FFB from small estate, its highly unlikely.
But the recent run has turn a lot of CPO companies into Net Cash position ... too bad Jtiasa yet to achieve such yet.
2022-07-06 08:16
For Gloves the Asp premium only lasted one year because China came into the picture with own glove manufacturing
Since China could build a new hospital in just 10 days they could build new glove factories in just 3 to 4 months and start fierce price war
What China did to gloves China cannot do the same with palm oil as palm oil need at least 5 years from planting to 1st drop of cooking oil
As for fertilizer cost it also came down when natural gas corrected
Now Must sell all Vege oil in unison
Sunflower oil now 100% above last world record due to Ukraine port blockage
Canola crop failed in Canada due to drought last year and this year farmers planted less by 7%
Soyoil being turned to biofuel in USA due to high petrol price
Canola oil is higher by 50% above world record
So if competing vege oil high palm oil will be supported
2022-07-09 16:58
Must see all Vege oil as a whole
if sunflower oil, canola oil and soyoil are high then palm oil cannot be low
2022-07-09 17:01
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calvintaneng
The sudden drop of cpo prices from above Rm6000 to Rm4700 was due to sudden release of Indonesia's 1.7 million tonnes of Cpo
Market over reacted!
But a hungry 8 Billion world popuation will easily absorb all in just weeks
Look beyond this and we will have a clearer picture yet to come
As Demand will Overtake scant supplies Prices will Rebound
2022-07-02 16:47