Business

Published: Wednesday September 12, 2012 MYT 11:47:00 AM

CPO futures extends losses, lowest since mid-August


KUALA LUMPUR: Crude palm oil futures fell to the lowest since mid-August on Wednesday on investors' concerns about rising stockpile, with PPB Group and Batu Kawan among the major losers.

At 11.30am, PPB was down 12 sen to RM12.56 with 72,200 shares done while Batu Kawan lost 10 sen to RM18.60 with just 3,000 units transacted.

CPO for third-month delivery fell RM23 to RM2,896 per tonne, but off the early low of RM2,888.

The FBM KLCI eased 0.10 of a point to 1,614.14. Turnover was 246.17 million shares valued at RM413.70mil. There were 258 gainers, 236 losers and 262 counters unchanged.

CIMB Equities Research said on Wednesday it believes that plantation earnings for most Malaysian planters may have bottomed in the quarter ended June 30, 2012.

It said a significant pick-up in the third quarter production should more than compensate for the lower selling prices. However, 3Q12 earnings are expected to be weaker than the previous year due to lower selling prices and higher costs of production.

"We maintain our Trading Buy call on the prospect of a short-term CPO price rally due to weather concerns. Our top picks in the region continue to be Astra Agro, Indo Agri and Sime Darby," said CIMB Research.

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