Kuala Lumpur, March 18 -- The ongoing conflict in the Middle East is casting a shadow over Malaysia's plantation sector, driving up costs and potential demand disruption.
RHB Research analyst Hoe Lee Leng said the geopolitical tensions have created a "multi-faceted impact" on the industry. While higher crude oil prices have pushed crude palm oil (CPO) prices up 11.6% since the conflict began, narrowing the palm oil-gasoil (POGO) spread and potentially supporting Indonesia's B50 biodiesel mandate, the negative ramifications are more concerning.
Hoe said shipping route closures near the conflict zone threaten demand from countries such as Pakistan, Egypt, Saudi Arabia, Turkey, the United Arab Emirates and Iran, potentially affecting up to 1...