Brokers' take

Plantations | Neutral

CIMB Research, Dec 22

MALAYSIA has extended the export tax exemption on crude palm oil (CPO) to end-February 2015 to boost CPO exports and reduce inventories. We are neutral on this move as the CPO export tax will likely stay at zero anyway given the current CPO price of RM2,119/tonne, which is below the reference rate of RM2,250 that will trigger the export tax. This also means that CPO will be tax-exempt for the sixth straight month, from Sept 14 to Feb 15.

Malaysia usually calculates its CPO tax using average monthly prices provided by the Malaysian Palm Oil Board (MPOB), where a monthly average at and above RM2,250 per tonne will trigger taxes that start f…