Malaysian palm oil stocks drop to six-month low

KUALA LUMPUR: Malaysian palm oil end-stocks shrunk to their lowest in six months as the aftermath of flooding in the Borneo region reduced production to its weakest since February 2011, data from the industry regulator show.

The drop in stocks could add fuel to a rally in benchmark prices, which last week recorded their biggest weekly climb in six years, after the world’s No. 1 producer Indonesia approved a near-threefold rise in biodiesel subsidies that is expected to boost palm consumption.