KUALA LUMPUR (April 10): Malaysia’s palm oil stocks posted their first rise in six months in March, as production recovered and imports rose sharply, offsetting strong festive demand, data from the industry regulator showed on Thursday.

Palm oil stocks at the end of March rose 3.52% from February to 1.56 million tonnes, marking the first increase since September, the Malaysian Palm Oil Board (MPOB) said.

Malaysia’s crude palm oil production rose 16.76% last month from February, to 1.39 million tonnes, the first increase in three months, while palm oil exports rose 0.91% to 1.01 million tonnes, the MPOB said.

A Reuters survey had forecast inventories at 1.56 million tonnes, with output seen at 1.31 million tonnes and exports at 1.02 million tonnes. 

Palm oil imports surged 82.5% to 121,886 tonnes in March, the highest since June 2023, due to strong demand during Ramadan, and as some producers sought to fulfill export commitments by importing from Indonesia.

"Indonesia’s export levies were lower in March, so it made sense to bring in Indonesian palm oil, especially with Malaysia’s stock running low," said a New Delhi-based trader with a global trade house.

Malaysia’s palm oil consumption in March rose to 453,046 tonnes, from 328,591 tonnes a month ago, MPOB data showed.

Exports in March were the lowest for the month since 2006, as palm oil’s premium over soyoil prompted buyers to purchase more soyoil, said Anilkumar Bagani, research head of Mumbai-based vegetable oil broker Sunvin Group.

"But now, palm oil’s premium over soyoil is shrinking. That’s bringing buyers back to palm oil, which could keep prices up, unless production jumps sharply from April onwards," Bagani said.

Following is a breakdown of the MPOB figures and Reuters estimates for March (volumes in tonnes) 

*indicates revised figures by the MPOB

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