Malaysia’s palm oil stocks to dip below 2 million tonnes next month and push prices up, analysts say

KUALA LUMPUR (Feb 14): The expected decrease in palm oil production in the upcoming months, coupled with a surge in demand from the export market, has the potential to push Malaysian palm oil stocks below the two million-tonne mark by next month, which could contribute to an upswing in crude palm oil (CPO) prices. According to data from the Malaysian Palm Oil Board, Malaysia's palm oil stocks for January reached a six-month low of 2.02 million tonnes, which is below the market's estimated 2.09 million tonnes, due to lower output and exports. In a recent note, RHB Research highlighted that while palm oil production is expected to decrease in the coming months, there is anticipation of a resurgence in the export market demand, likely due to the upcoming Aidilfitri festivities and restocking activities, leading to further depletion of stock levels. “With this, January’s annualised S/U [stock/usage] ratio is now 10.3%, slightly above the 15-year historical average of 10%. We expect ...