KUALA LUMPUR (Reuters) – Malaysia’s palm oil stocks at the end of 2021 are expected to fall for the third straight year to 1.12 million tonnes, the state agency Malaysia’s Council of Oil said on Monday. palm oil (COPD).
Stocks in the world’s second largest producer plunged to 1.27 million tonnes last year due to a combination of labor and logistical issues caused by the COVID-19 pandemic, and the fact that Wet weather conditions caused by La-Nina adversely affected performance.
The council expects a moderate recovery in exports and production this year while expecting month-end stocks to be below 1.5 million tonnes for most of the year.
Prices are expected to remain firm due to supply issues as heavy rains in January and February will impact production, MPOC Managing Director Wan Zawawi Wan Ismail told an online seminar.
Prices for Malaysia’s benchmark crude palm oil are expected to average 3,846 ringgits ($928.99) a tonne in the first half of the year, Wan Zawawi said, adding they would fall to a low of RM3,502 and would peak at RM4,190.
Prices for the world’s cheapest and most widely used vegetable oil averaged 2,700 ringgit ($655.34) last year.
At the seminar, the industry regulator, the Malaysian Palm Oil Board (MPOB), maintained its crude palm oil price projection for 2021 at an average of 3,000 ringgits ($724.64) per ton. .
“The year 2021 is expected to bring better prospects for the Malaysian palm oil industry, with all key industry indicators expected to show better performance,” MPOB Managing Director Ahmad Parveez Ghulam Kadir said.
($1 = 4.1400 ringgit)
Reporting by Mei Mei Chu; Editing by Himani Sarkar and Subhranshu Sahu