Hong Leong IB Sees Malaysian Plantation Earnings Rising in Q3
Hong Leong IB expects Malaysian plantation companies to post higher third-quarter earnings on seasonal output gains and steady palm product prices.
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what happened
Market Talk reports that analyst Chye Wen Fei at Hong Leong Investment Bank expects Malaysia's plantation sector to post higher profits in the third quarter versus the prior quarter. She cites a seasonal rebound in production and mostly flat prices for palm products as the main drivers.
Upstream operations should benefit from bigger harvests and firmer prices, though costlier fertilizer and squeezed refining margins will partly offset that gain. Looking further ahead, she sees a shrinking palm oil supply, growing biodiesel demand in Indonesia and possible crop losses linked to El Nino, which could keep prices elevated into 2027. Hong Leong keeps an overweight rating on the sector and names Hap Seng Plantations and IOI Corp as its preferred stocks.
why it matters
For investors, the note suggests palm producers may see margin support in the coming quarters, while refiners remain under pressure. Biodiesel demand and weather in growing regions are the key variables to watch for the sector.
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sources
- Malaysia's Plantation Sector 3Q Earnings Expected to Improve — Market Talk, 27 October 2026 at 04:48 UTC
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