YOGYAKARTA: Malaysia palm oil stocks are set to
recover in May and rise faster in the next three months as Asian
consumers take up more soyaoil that trades on par with the tropical oil,
a senior official said yesterday.
Malaysian Palm Oil Board (MPOB) director-general Datuk Dr Mohd Basri
Wahid said palm oil stocks usually fall in the June-August period as top
buyers India and the Middle East stock up for religious festivals from
August starting from Ramandan fasting month.
But ample South
American supplies of soyaoil have made the normally expensive vegetable
oil trade at same level as FOB palm olein seen at US$810 (RM2,632.5) for
June delivery, prompting a switch of orders away from Malaysia, the No.
2 palm oil producer.
Also, India has record stocks of
oilseeds for crushing, discouraging crude palm oil imports from top
producer Indonesia as well as Malaysia.
“Palm oil stocks and
exports seasonality in Malaysia has been turned upside down,” Mohd Basri
said in an interview ahead of an industry meet in the historic
Indonesian city of Yogyakarta.
“April palm oil stocks hit 1.6 million tonnes and we will go way
above that in the next three months,” he said, declining to give
details.
MPOB, a key regulator for the industry, will release
its May palm oil stocks, production and export data on June 10.
Adding to the palm oil stock build-up in Malaysia is a stronger
output from May and June onwards as El Nino-driven hot weather eases and
stops aggravating yield stress in oil palms, Mohd Basri said.
But the effects of the unusual weather condition may be felt during
the sesaonal peak output season in October as higher temperatures in the
first quarter of this year may have stunted oil-rich palm flowers that
take six months to bear fruit.
“El Nino was not as bad as we
feared it would be. There could a moderation in the output but I believe
we can meet our target range of 17 and 18.1 million tonnes for
production this year,” Mohd Basri said. “It will just be at the lower
end.” – Bloomberg
Source : Business Times
