11.08.2021 (leaderpost.com) - KUALA LUMPUR — Malaysia’s palm oil stockpiles hit a four-month low at July end, falling below expectations, as production and imports shrank, according to

data released by the country’s palm oil board on Wednesday.

Inventories at the world’s second largest producer fell 7.3% from June to 1.5 million tonnes, its first decline in five months, the Malaysian Palm Oil Board (MPOB) data showed.

A Reuters survey had forecast inventories to rise 1.6% to 1.64 million tonnes.

MPOB data showed production declining 5.17% from June to 1.52 million tonnes, its lowest since April, as a labor shortage continue to delay harvesting amid the peak production season.

Exports fell 0.75% to 1.41 million tonnes, better than cargo surveyors’ estimates of July shipments declining between 5% and 8%. Imports fell 52% to 54,381 tonnes.

Tighter inventories are expected to support Malaysia’s benchmark palm oil contract, which is trading near

record highs hit in May. The contract jumped 6.2% to 4,455 ringgit ($1,051.45) a tonne by Wednesday afternoon.

“The report is bullish for the palm oil market as Malaysia’s 2021 palm oil production is expected to continue to be in trouble,” said Anilkumar Bagani, research head of Mumbai-based vegetable oils broker Sunvin Group.

The Malaysian Palm Oil Association (MPOA) lowered its estimates for the country’s 2021 production to 18 million tonnes, down from 19.14 million tonnes last year due to the labor crunch, the Star reported on Wednesday.

Following is a breakdown of the Malaysian Palm Oil Board figures and Reuters estimates for July (volumes in tonnes) :

July 2021 July 2021 poll June 2021* July 2020

Output 1,523,143 1,541,940 1,606,187 1,807,397

Stocks 1,496,460 1,640,000 1,614,219 1,698,036

Exports 1,408,321 1,359,000 1,419,004 1,783,284

Imports 54,381 91,800 113,126 52,691

*indicates revised figures by the Malaysian Palm Oil Board

($1 = 4.2370 ringgit)

(Reporting by Mei Mei Chu; Editing by Christian Schmollinger

and Rashmi Aich)