Palm oil stockpiles in Malaysia, the largest producer after Indonesia, surged 16 percent in December to the second highest on record. Inventory of the edible oil, used mostly in cooking, rose from November to 2.24 million metric tons, the Malaysian Palm Oil Board said in a statement today.
The record was 2.27 million tons in November 2008. “In all likelihood, the inventories and stock/usage ratio will go up,” said Ben Santoso, a plantation analyst at DBS Securities (Singapore) Pte ahead of the data release. “I expect some minor correction later.”
For the full year, output surged 16 percent to a record 20.5 million tons in 2009, from 17.7 million in 2008, taking into account the revised data. Exports rose to 15.84 million tons, from 15.4 million in 2008.
“Palm oil production should pick up from March 2010 onwards and continue its upward trend until October or November,” said a Goldman Sachs report by analysts Patrick Tiah and Nikhil Bhandari on Jan. 6. Still, production growth this year and next would be “below trend,” it said, because of replanting and lower yields.
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