Malaysian Palm Oil Prices Set to Rise Amidst Decreasing Stockpile

Anticipating a surge in the near future, Malaysian Palm Oil prices are poised to climb as stockpiles in the country are predicted to dwindle, according to market analysts.

The current trading value of the benchmark palm oil contract stands at 3,940 ringgit per ton, marking a 1% increase for the day.

Palm oil is gearing up for its third consecutive victory, experiencing a robust 1.7% surge in these triumphant sessions.

In a note released on Wednesday, Maybank Investment Bank projected that Malaysia's palm oil stockpile is likely to dip below 2 million tons by the end of February. The bank reiterated its view, suggesting that CPO prices might briefly surpass 4,200 ringgit ($878) per ton in February/March, as reported by APP.

January witnessed a seasonal decline in stockpiles to 2.02 million tons, falling below street estimates of 2.09 million tons. The decreased stockpile is attributed to resilient January exports, totaling 1.35 million tons, while production continued its seasonal descent to 1.4 million tons.

However, it is crucial to note that the research house expressed the opinion that CPO prices are expected to trend lower by mid-2024. This anticipation is based on the availability of new South American harvests and the expectation of CPO output recovery in the second half of 2024.