Malaysia’s Palm Oil Stocks Rise Amid Weak Export Performance

10-Jul-2025 03:16 PM

Kuala Lumpur. In Malaysia, the world’s second-largest producer and exporter of palm oil after Indonesia, surplus stock of the key vegetable oil has risen above 2 million tonnes, raising concerns of downward pressure on prices.

This build-up has occurred after a long interval and is attributed to a significant drop in export performance.

According to official June data from the Malaysian Palm Oil Board (MPOB), crude palm oil (CPO) production in Malaysia declined by 4.48 percent compared to May, falling to 16,92,310 tonnes.

However, exports declined even more sharply. On a monthly basis, total exports of palm oil products dropped by 10.52 percent to 12,59,354 tonnes, leading to a large accumulation of stock as production exceeded exports.

By the end of June 2025, Malaysia’s total palm oil stock rose by 2.41 percent to 20,30,580 tonnes compared to May. Within this, CPO stock actually declined by 5.42 percent to 10,41,740 tonnes, while refined palm oil (RBD palmolein) stock surged by 12.20 percent to 9,88,840 tonnes.

Malaysian exporters generally prioritize the export of crude palm oil, unlike Indonesia which focuses more on processed oil.

Meanwhile, stock of palm kernel oil decreased slightly by 0.55 percent to 2,86,520 tonnes. Interestingly, palm oil imports into Malaysia increased by 1.51 percent to 70,000 tonnes during the same period.

According to trade analysts, Malaysia must take additional steps to boost palm oil exports to prevent a further rise in surplus stock.

The elevated futures price of crude palm oil on the Bursa Malaysia Derivatives (BMD) Exchange is making exports less attractive. Enhancing competitiveness compared to soybean oil may help revive demand and support market balance.