First Resources' crude palm oil production up 38.4% in Q4

On the back of an improved oil extraction rate.

Agribusiness giant First Resources reported higher crude palm oil production in 4Q16 in line with the spike in fresh fruit bunch production.

According to a UOB KayHian report, CPO production increased 12.7% QoQ and 19.0% YoY in 4Q16 on the back of an improved oil extraction rate (OER). However, for the whole of 2016, CPO production dropped 7.6%.

UOB said prices are expected to be higher in the said quarter, as Indonesia Dumai/Belawan CPO prices inched up 3.8% QoQ but surged 38.4% YoY.

"The substantial increase in CPO prices was mainly due to tight supply and stable export demand. All in all, we reckon CPO prices will hover at US$650-750/tonne in 1H17, and are likely to decline when production picks up in 2H17," the firm explained.