Palm Planters' Fertilizer Costs Expected to Stay Elevated — Market Talk

Fertilizer prices are likely to remain elevated over the next 12-24 months even if Middle East tensions ease, with supply disruptions and export curbs keeping global markets tight, Maybank IB's Ong Chee Ting says in a note. The cost impact for palm oil growers may be limited in the near term, given that most 1H fertilizer needs were secured earlier, the analyst says. The bigger risk is to output, as any cut in fertilizer use, especially by smallholders, could reduce fresh fruit bunch yields with a six- to 24-month lag, potentially affecting crude palm oil production in 2027, he says. Higher fertilizer costs may remain manageable for now, supported by firm CPO prices, he adds. SD Guthrie, Sarawak Oil Palms and Genting Plantations are Maybank's preferred buys. (yingxian.wong@wsj.com)