Malaysia’s palm oil inventories fell to a 19-month low in December, according to Reuters

By Ashley Tang and Rajendra Jadhav

KUALA LUMPUR/MUMBAI (Reuters) – Malaysia’s palm oil inventories fell for a third consecutive month in December to the lowest level since May 2023, as floods cut output, data from the industry watchdog showed on Friday.

A decline in inventories in the world’s second-largest palm oil producer after Indonesia in recent weeks could support sharply adjusted futures after hitting a 2-1/2-year high in November.

Malaysia’s palm oil inventories fell 6.91 percent to a 19-month low of 1.71 million metric tons at the end of December from a month earlier, data from the Malaysian Palm Oil Board (MPOB) showed.

Crude palm oil production fell 8.3% to 1.49 million tonnes, the lowest since March 2024, while palm oil exports fell 9.97% to a six-month low of 1.34 million tonnes.

A Reuters poll had forecast production of 1.76 million tonnes, 1.48 million tonnes and exports of 1.38 million tonnes. (palm/choice)

Anilkmar Bagani, head of research at Mumbai-based vegetable oil broker Sunvin Group, said the December MPOB data fell short of market expectations, as yields fell more than expected.

Malaysia’s palm oil consumption rose 53 percent to 309,865 tonnes in December from a month earlier, the data showed.

Palm oil has been trading at high prices to rival soybean and safflower oils, and prices should adjust to attract interest from net buyers, said a Mumbai-based global trader.

“Even in January, exports remain weak,” the trader said.

The following is a list of Malaysia Palm Oil Board figures and Reuters December estimates (volumes in tonnes) (PALM/POLL).

December 2024 November December

2024 election 2024 2023

Result 1,486,786 1,483,000 1,621,294 1,550,796

Shares 1,708,747 1,755,000 1,835,641* 2,290,793

Exports 1,341,732 1,375,000 1,490,293* 1,362,145

Import 37,917 22,500 22,081 40,062

* Indicates figures revised by the Malaysian Palm Oil Board