Futures for palm oil in Malaysia almost did not react to the reduction of stocks to a 19-month low

According to the Malaysian Palm Oil Board (MPOB), in December 2024, the country’s palm oil stocks decreased by 6.91% to a 19-month low of 1.71 mln tonnes, production – by 8.3% to the lowest level since March 2024, and exports – by 9.97% to a 6-month low of 1.34 mln tonnes, OleoScope reports.

Palm oil stocks in Malaysia have been declining for the third consecutive month due to reduced production caused by severe flooding, and have already fallen to the lowest level since May 2023. At the same time, the consumption of palm oil in the country in December increased by 53% to 309 thsd tonnes.

It is expected that in January, the palm oil stocks will increase to 1.76 mln tonnes, exports – to 1.38 mln tonnes, and production will decrease to 1.48 mln tonnes.

amid the rapid growth of prices for soybean oil in Chicago, the March futures for palm oil on the Bursa exchange in Malaysia on Friday rose by 2.26% to 4393 ringgit/t or 977,7 $/t (+0.57% for the week), although analysts had expected a more significant increase.

Futures for soybean oil on the Chicago stock exchange on Friday rose by 6.8% amid lower forecasts of soybean crop in the United States, which in the near future will support the price of palm oil.

According to surveyors, the export of palm oil from Malaysia in the period from 1 to 10 January decreased by 21.4-26.8%, which will somewhat limit the growth of prices.

Amid tighter sanctions on oil exports from Russia, oil prices continue to rise, which will be an additional factor supporting vegetable oil prices in the coming weeks.

Tags: Malaysia, palm oil, stocks