Wedoany.com Report-Jan 7，Malaysia’s palm oil inventories are forecast to fall in December, for a third consecutive month, amid declining production due to recent heavy rainfall that affected the harvest.
Palm oil stocks are expected to fall to 1.76 million tonnes, down 4.42% from November, according to a median estimate from 11 traders, planters, and analysts.
The lower end-stocks are in line with overall expectations, following the recent rainfall in the country, said Lingam Supramaniam, director at Selangor-based brokerage Pelindung Bestari.
The Malaysian Palm Oil Board in early December said production was expected to fall in December as heavy rainfall hit harvesting in the world’s second-largest producer of the tropical oil.
The poll also found that crude palm oil output is expected to fall 8.53% to 1.48 million tonnes, the fourth consecutive monthly decline and the lowest level since April 2024.
Lingam said attention was now shifting to demand prospects in the first quarter of 2025, especially given the bumper soybean crop harvest in Brazil.
“The lower prices of competing edible oils will also keep palm prices capped and the ambiguity surrounding Indonesia’s B40 biodiesel mandate is another reason for the damper effect,” he said.
Exports of palm oil products in December are projected to fall by 7.55% to 1.38 million tonnes, their second consecutive monthly decline, the survey showed.
“Cargo surveyors’ data indicated lower exports. The market is now eager to see December’s production numbers as November’s production fell short of the industry’s expectations,” said a New Delhi-based dealer.
The dealer added that any unexpected decline in December’s production could support falling palm prices.
The Malaysian Palm Oil Board is scheduled to release its monthly data on Jan 10.
