MUMBAI (Oct 1): Malaysian palm oil prices are likely to remain between RM4,500 and RM5,000 a tonne through December, as higher stocks weigh on prices despite expectations of lower production next year due to El Niño, a top analyst said on Thursday.

Malaysia's palm oil stocks are likely to exceed three million tonnes by the end of this month, which will weigh on prices, said Dorab Mistry, the director of Indian consumer goods company Godrej International.

Mistry is one of the most closely watched analysts of edible oils whose forecasts for supply and prices often move markets.

The benchmark palm oil contract on the Bursa Malaysia Derivatives Exchange fell 1.58% to RM4,537 at the midday break on Thursday, after hitting a nearly two-year high of RM5,049 in mid-September.

El Niño, which typically brings drier conditions to top palm oil producers Indonesia and Malaysia, could curb production in 2027, although new seed varieties are more resilient to dry weather, he said.

Rising energy prices due to geopolitical conflicts have boosted biodiesel demand, while Indonesia's new 50% biodiesel blending mandate is expected to tighten palm oil supplies and support prices, Mistry said.

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