Malaysia’s palm oil stocks hit six-month low

Malaysia’s palm oil stocks fell to their lowest in six months at the end of January as production plunged to the lowest level in nine months amid steady exports, the industry regulator has said.

The reduction in stocks of the world’s second-largest palm oil producer after Indonesia would help in supporting benchmark futures, which lost 10% in 2023.

Data from the Malaysian Palm Oil Board (MPOB) showed that palm oil stocks at the end of January fell 11.83% from the previous month to 2.02 million tonnes, the lowest since July.

According to the MPOB, crude palm oil production declined 9.59% from last December to 1.40 million tonnes in January, the lowest since last April, while exports dropped 0.85% to 1.35 million tonnes.

Last week, oil palm industry officials said a recovery in palm oil prices can be limited by abundant supplies of soybean and sunflower oils.

However, Malaysian palm oil prices recorded a decline on February 13 due to weak demand from top importer India.

India, the world’s largest importer of vegetable oil, reduced imports in January by more than 12% compared to last December to the lowest level in the past three months due to negative crude palm oil refining profit margins which caused refineries to switch to using soybean oil.

Tags: Malaysia, palm oil, stocks, benchmark futures, exports, Indonesia, Production