Malaysian Palm Oil Council Russia's Post

Palm Oil Stockpiles in Malaysia Seen Surging to Five-Month High

By Anuradha Raghu
(Bloomberg) -- Palm oil inventories in Malaysia probably expanded to the largest in five months at the end of July as production in the world’s second-biggest grower rebounded, countering the impact of stronger exports.

Stockpiles rose about 4.1% from a month earlier to 1.79 million tons, according to the median of 13 estimates in a Bloomberg survey of analysts, traders and plantation executives.

That would be the third straight monthly increase.

Crude palm oil production jumped about 7.6% to a seven month high of 1.56 million tons, after dropping 4.6% in June, the survey showed. Exports climbed about 9.4% to 1.28 million tons, the biggest since March.

“The growth in stocks will be the most important thing to watch from here onwards,” said Nagaraj Meda, managing director of Hyderabad-based TransGraph Consulting.

Benchmark futures in Kuala Lumpur rallied above 4,000 ringgit a ton last month on worries that the worsening conflict in the Black Sea region will hurt exports of sunflower oil and channel demand to palm, but they have since retreated as attention shifts to rising supplies.

Prices have fallen 3.6% so far this week, even as the tropical oil rose 1% to 3,862 ringgit by the midday break on Friday.

Charts suggest that palm could drop toward 3,725 ringgit in the near term, according to Gnanasekar Thiagarajan, head of trading and hedging strategies at Kaleesuwari Intercontinental.
By: via Malaysian Palm Oil Council Russia