PETALING JAYA: Malaysia’s palm oil exports fell 18.44% to 971,640 tonnes in February – the lowest since 2007 – from a month earlier, following lower demand from major importers China, Pakistan, the European Union and the United States, according to the Malaysian Palm Oil Board (MPOB).
MPOB said in a statement palm oil stocks also dropped 1.53% to 1.74 million tonnes in February from 1.77 million tonnes in January.
For the month under review, crude palm oil (CPO) production also eased to 1.12 million tonnes from 1.16 million tonnes previously.
A trader said the lower inventory and production for February came as no big surprise, given the recent floods in palm oil growing areas in the east coast and some parts of Johor and Perak that had affected harvesting of fresh fruit bunches (FFB).
“However, the lower exports in February was a bit of a surprise as many had expected China to stock-up more palm oil during the recent Chinese New Year celebration.”
JF Apex Securites, in its report, estimated palm oil inventory to stay flat in March as “we expect the improving CPO production to be absorbed by the recovery in palm oil exports.”
CPO prices were also little changed in February, inched down by a marginal 1.3% month-on-month to RM2,264 per tonne.
The euphoria over Indonesia’s plan to boost biodiesel subsidies receded towards the end of February, resulting in the marginally lower CPO prices.
The research unit is maintaining a “neutral” view on the CPO price outlook, with its top pick being Genting Plantations Bhd.
“We reckon that the burgeoning earnings contribution from the company’s operation in Indonesia would serve as earnings catalyst to the group from 2015 onwards,” it added.
CPO futures on Bursa Derivatives Exchange extended its decline yesterday following the weak export figures in February by the MPOB. As at 5pm, the benchmark CPO futures contract for May lost RM39 to RM2,232 per tonne.
Bloomberg said independent cargo surveyor Intertek reported that palm oil shipments in the first 10 days of this month had dropped 12% to 262,168 tonnes compared with the same period last month.
At Bursa Malaysia’s palm oil conference last week, palm oil experts Dorab Misty of Godrej International and Dr James Fry of LMC International Ltd had described 2015 as “the year for two halves for CPO prices.”
Both distinguished the CPO price to average higher at about RM2,337 per tonne in the first half, but was set to weaken to around RM2,159 per tonne in the second half 2015 due to changes in supply dynamics.
Source : The Star]]>