Malaysia’s palm oil stocks at 16-month high

KUALA LUMPUR: Malaysia's May palm oil stocks rose nearly 15% to their highest in 16 months as production overtook exports, potentially weighing on benchmark futures.

Industry regulator Malaysian Palm Oil Board (MPOB) said yesterday that stocks in the world's No 2 producer rose to 1.92 million tonnes from 1.67 million tonnes a month ago, reaching a level unseen since January 2010 and just above market expectations.

The high stocks will weigh on Malaysian palm oil futures that fell marginally before the data release.

“The numbers are within market expectations, but the question is whether these numbers will spur further profit taking or selling,” a local trader told Reuters.

May output rose 13.7% to 1.74 million tonnes from April as yield continued to soar after two years of unfavourable crop conditions.

Production is expected to slow in August as estate workers take leave to observe the Muslim fasting month of Ramadan and return mostly to Indonesia.

Malaysian exports in May rose 4.3% to 1.4 million tonnes, up for the thirdstraight month, as China and India replenished inventories and Muslim countries such as Pakistan and Egypt were in the market to stock up ahead of Ramadan. - Reuters

Sime will up up up. Tradewinds i think is the potential counter... still very low price.. but no good bb to play

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