Is the hate for palm oil justified?
When a company operates in a hated sector, its stock price can remain low for a long time, and perhaps rightfully so. However, if the sector is hated but the reasons do not apply to the company, then it's a different story. Can such a company step out of the shadow of such a hated sector? Is the perception of the entire sector perhaps based on issues that are no longer prevalent or less common today?
I am referring to palm oil here. If we look at palm oil objectively, without emotion, we see how indispensable it is. According to the website palmoilscorecard.panda.org, a website of the WWF, palm oil accounts for 60% of all traded vegetable oils. It is present in 50% of all processed products such as frozen pizza, noodles, chocolate, personal care, and cleaning products. Additionally, 70% of all cosmetics contain palm oil components.
The WWF also indicates that palm oil is the most efficient to produce per hectare of land. According to the WWF, other vegetable oils yield 4 to 10 times less on the same land area. Furthermore, they generally use less water and fertilizers. In other words, perhaps palm oil should be viewed differently. And in that regard, I present to you one of, if not the, best company.
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