The planting industry is soaring against the wind, with the leading SDG breaking a two-year high.

HarryTeo wrote a column · Nov 2 00:19

#Steady growth is better than rapid growth.

In the past few weeks, the sentiment of hong kong stocks has been low, as everyone is now focusing on the USA presidential election. However, with CPO prices breaking a two-year high, the planting stocks long forgotten by the market are once again attracting hot money.

In the first half of 2022, the planting industry in Russia and Ukraine war-driven, the CPO price reaching a historical high boosting palm oil stocks to soar. Unfortunately, the cycle is very short, rising for two quarters before facing a decline. In 2023, the planting industry profit declined year-on-year, with planting stocks in a consolidation period.

Entering the first half of 2024, many high-quality planting stocks have achieved year-on-year profit growth. In addition, Indonesia's production capacity declined due to weather issues, with the Indonesian government promoting diesel B35 and moving towards B40 in 2025.

Global palm oil inventory is at a 3-year low, combined with various factors supporting CPO prices breaking through a 2-year high. However, rising palm oil prices too quickly may not be a good thing, as the Malaysian Ringgit rose too fast before, and the correction came fierce.

For the planting industry, assuming CPO prices can stabilize at RM4,500 or above, a gradual increase is actually healthier. Malaysia's planting area is limited to 6.5 million hectares, so increasing production efficiency, enhancing automation, and reducing reliance on foreign labor are top priorities.

In recent years, palm oil production capacity has hit a bottleneck, and demand for palm oil production capacity is gradually increasing, which is bullish for the palm oil industry. However, various challenges such as environmental protection issues, minimum wages, and fertilizer transportation costs are obstacles that planting industry participants must overcome.

We previously recorded a video about the ups and downs of the planting industry, as well as listed 10 planting NetCash dividend service companies. You can click the following link🔗 to watch the video.

https://youtu.be/xRbqqu7A1fU