PETALING JAYA: Malaysian palm oil inventory may have fallen 2% month-on-month (m-o-m) to 2.13 million tonnes as at end-June 2018, on the back of declining crude palm oil (CPO) output, according to CIMB Research.
The forecast is ahead of the release of official figures next Tuesday.
The research house, citing findings from a survey of 24 plantation areas by the CIMB Futures team, said CPO output likely fell 13.4% m-o-m to 1.32 million tonnes in June 2018.
It said the projected decline for the month was below the historical average of of 1.9% for m-o-m declines in June, over the past 10 years.
“We attribute the larger-than-historical-average fall in output to lower productivity as many workers took time off to celebrate the Eid-al-Fitr.
“Our survey revealed sharper production decline in Sabah estates, followed by Peninsular Malaysia. Sarawak estates posted the smallest drop in production,” it said in a note.
CIMB Research said Malaysian palm oil exports, meanwhile, is expected to have fallen about 10% m-o-m, mainly due to weaker demand from China, which declined 6.7%, and the EU, which was was 12.9% lower.
The declines, however, were partially offset by stronger demand from India, with a 35% increase.
The research house said the estimate was based on export statistics released by cargo surveyor Societe Generale de Surveillance, Intertek and Amspec Malaysia.