Affin cuts 2013 palm oil price forecast

Affin Investment Bank cut its average selling price forecast on
Malaysian crude palm oil this year to RM2,600 per tonne from RM2,800,
citing a sluggish price outlook amid high inventory levels and an
uncertain global economy.

"While exports may pick up again ahead
of Ramadan, challenges remain - including uneven global growth, high
palm oil stocks, the outbreak of the H7N9 virus in China, and likely
delay in the implementation of B10 biodiesel policy," Affin said in a
note on Friday.

The research house also slashed its price forecasts for 2014-2015 to RM2,700 from RM2,800.

Palm oil futures on the Bursa Malaysia Derivatives Exchange have lost 7.3 per cent so far this year.

Affin
added that Malaysian planters now face new challenges including the
revised criteria for producing certified sustainable palm oil and new
regulations that cap plantation land ownership in Indonesia.

It
also cut its rating on oil palm planter Felda Global Ventures Holdings
Bhd's to 'reduce' from 'add' and lowered its target price to RM4.07 per
share from RM4.64.

Affin upgraded Sarawak Plantation Bhd to
'buy' from 'add', and raised its target prices on IOI Corporation Bhd ,
Sime Darby Bhd, Genting Plantations Bhd, IJM Plantations Bhd by between
four and 18 per cent.

Shares in Felda Global slipped 0.44 per cent against the Malaysian benchmark stock index's 0.36 per cent loss.-- Reuters