Malaysia CPO Production Lags In 3Q21
Malaysia’s palm oil stocks were lower than expected at 1.61m tonnes in Jun 21 due to lower-than-expected CPO production. This is similar to our expectation where 3Q21 production growth would be lower than market expectation and the strong production recovery would only come in in 4Q21. Maintain MARKET WEIGHT in view of the weakening CPO prices. For investors who want exposure to this sector, our top picks would be Hap Seng Plantations and Kuala Lumpur Kepong.