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KUALA LUMPUR: Teck Guan Perdana Bhd has signaled a guarded outlook for its palm-related businesses in the near term, acknowledging that resilient downstream demand continues to underpin its operations even as lower crop output and weather-related disruptions threaten harvesting activity and raw material availability.
The Malaysian group said oil palm crop production is expected to fall short of the level recorded during the same period last year. It warned that the potential emergence of El Niño conditions, compounded by recent haze episodes across Southeast Asia, could further disrupt harvesting operations and tighten the supply of fresh fruit bunches.
'In spite of these near-term constraints, the Board remains cautiously optimistic on the long-term prospects of its palm-based businesses,' the company stated in notes accompanying its latest financial results.
Teck Guan Perdana also pointed to supportive global drivers, highlighting Indonesia's ongoing palm-based biodiesel programme alongside the expansion of renewable fuel requirements in the United States. Together, these policy initiatives are expected to underpin demand for vegetable oils on the international market.
The group's comments underscore the balancing act facing Southeast Asian palm industry players: managing short-term weather and yield pressures while capitalising on structural demand tailwinds driven by the global energy transition.
Source: KLSE Screener