Malaysia’s palm oil stocks at the end of December are at their lowest in 5 months as production plunges

  • December shares fell 4.9% to 1.73m tonnes – survey
  • Production down 8.6% to 1.49 million tonnes – survey
  • Exports down 4.9% to 1.4 million tonnes – survey
  • Malaysian Palm Oil Board data due Jan. 10

KUALA LUMPUR, Jan 5 (Reuters) – Malaysia’s palm oil stocks at the end of December likely fell to their lowest level in five months as production fell, a Reuters investigation revealed on Wednesday.

Stocks in the world’s second largest producer are expected to fall 4.9% from the previous month to 1.73 million tonnes, according to the median estimate of ten growers, traders and analysts polled by Reuters.

Production is expected to plunge 8.6% to 1.49 million tonnes, the lowest since March, as severe flooding across the country disrupted harvesting activities. Read more

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“The extent of the damage caused by the recent floods in Peninsular Malaysia has further stretched the productive capacity of plantations and estates,” said Lee Toong Huang, managing director of Kwantas Oil.

Exports are expected to fall by 4.9% to 1.4 million tonnes, as estimated by freight inspectors.

Weak production should support prices as plantations enter seasonal low production in the first quarter of 2022, while exports are expected to remain subdued due to high prices, said William Simadiputra, analyst at DBS Vickers Securities in Jakarta.

The Malaysian Palm Oil Board will release official data on January 10.

Breakdown of December estimates (in tonnes):

*Official November stocks of 1,816,879 tonnes plus production and imports estimated above give a total December supply of 3,397,273 tonnes. Based on the median of exports and estimated ending stocks, Malaysia’s domestic consumption in December is estimated at 272,694 tonnes.

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Reporting by Mei Mei Chu; Editing by Ed Davies

Our standards: The Thomson Reuters Trust Principles.

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Felix J. Dixon