Crude palm oil prices to stay robust on inventory crunch, but may not lift all SGX agri counters

[SINGAPORE] Crude palm oil (CPO) prices are expected to stay high in 2025 as inventories shrink and output weakens, deepening a supply crunch that could fuel earnings growth for Singapore-listed plantation stocks. 

The Malaysian Palm Oil Board’s data released last week showed stockpiles at a low of 1.5 million tonnes as at end-February, due to weak production levels. This marks Malaysia’s fifth consecutive month of declining inventories, underscoring tight supply conditions in the world’s second-largest palm oil producer and exporter.

This reinforced RHB Research’s “overweight” stance on the sector, citing strong pricing power and a projected 12.4 per cent earnings growth for plantation players in 2025, driven by firm selling prices amid tight supply and strong demand.