InfoSAWIT, JAKARTA - Mirae Asset Sekuritas decreased the investment level in crude palm oil (CPO) sector from Overweight to be Neutral. It happened for there are three factors as the considerations.

Senior analyst Mirae Asset Sekuritas, Andy Wibowo Gunawan said, the first one is the production volume is higher in the second semester in 2017. The second, to anticipate the over stock of soybean oil which could press the soybean oil price and CPO price globally. The third, the plan of the government of Indonesia to prolong the palm oil moratorium.

The soybean production in USA will be increasing by the wider planted areas and harvest. The soybean oil price globally has something to do  with the CPO price in Malaysia. “It means, the soybean oil stocks get more and could make it cheaper, and so could be the CPO price in Malaysian Exchange,” he said, as quoted from Bisnis.

Andy also mentioned, the local investors do not like CPO shares because of the new moratorium. But Mirae still convinced the CPO demands in the long term because it is the main material and the most economical cooking oil. By making good strategy to get new planting, palm oil company could survive in the long term too. The share recommendation in palm oil sector, proposed by Mirae, is SSMS within the target, Rp1.900 to the end of 2017. (T4)