Malaysia’s Late March Palm Oil Stocks Rise as Production Rises, Exports Rise

Malaysia’s palm oil stock is expected to rise at the end of March, with an increase in exports and a fall in imports offsetting the growth in production, a Reuters survey showed on Monday. Stocks in the world’s second largest producer are expected to rise 0.51% from February to 1.53 million tonnes, rising for the first time in five months, according to the median estimate of 10 planters, traders and analysts polled by Reuters . This compares to the 1.45 million tonnes recorded a year ago.

Production, which had been falling since October, is expected to rise 16.4% to a three-month high of 1.32 million tonnes. Production is expected to resume after weaker-than-expected production over the past two months, said William Simadiputra, analyst at DBS Vickers Securities. Exports are expected to increase by 6.3% to 1.17 million tonnes, in line with estimates from freight inspectors indicating increased shipments to major buyers India and China. Imports are expected to drop nearly 22% to 117,000 tonnes. Exports rose on strong demand for palm olein, especially in the Middle East and countries with large Muslim populations to meet growing demand ahead of the fasting month of Ramadan, Sathia Varqa said. , co-founder of Singapore-based Palm Oil Analytics.

“Countries like Egypt, Iran and Saudi Arabia, which typically depend on sunflower oil, have had to buy palm to meet the high seasonal demand,” he said, adding palm olein shipments to the region will remain strong in April. Global sunflower oil supply has taken a hit after Russia’s invasion of Ukraine damaged port infrastructure and disrupted edible oil supplies to the key Black Sea region, forcing buyers to look for alternatives. However, it has also pushed palm oil prices to record highs in recent months, triggering demand rationing among some price-sensitive importers. In April, a sustained increase in production, helped by a favorable weather outlook, will keep prices under pressure, but the behavior of crude oil prices will keep palm prices in check. Official stocks of 1,518,293 tonnes in February, plus production and imports estimated above, March supply of 2,959,293 tonnes. Based on the median of exports and estimated ending stocks, Malaysia’s domestic consumption in March is estimated at 265,940 tonnes.
Source: Reuters (report by Mei Mei Chu; editing by Kanupriya Kapoor)


Source link

Felix J. Dixon