KUALA LUMPUR: Malaysia's palm oil stocks probably fell to a six-month low in February as a decline in exports outpaced a fall in production, a Reuters median survey of five plantation houses showed on Friday.
Stocks likely dropped 3.0 percent to 1.95 million tonnes, a level unseen since August, as the slew of Malaysian holidays at the start of the month slowed harvesting rounds and demand slowed due to Indonesia's export tax advantage.
Malaysia's February output dropped 9.1 percent to 1.17 million tonnes from 1.29 million tonnes in January, but still higher than the 1.1 million tonnes seen a year ago.
Exports in February fell 9.5 percent to 1.25 million tonnes, suggesting a weaker demand for Malaysian refined palm oil products as buyers shift their orders to top producer Indonesia.
But the decline was less compared to the 13.2 percent drop in January as the Malaysia's government issued a tax free export quota for 3 million tonnes of crude palm oil, allowing producers to ship out the grade and feed their overseas refineries.
Malaysian imports of crude palm oil from top producer Indonesia slumped 34.3 percent to 110,000 tonnes as Indonesian firms used more of the crude grade domestically to process into refined palm oil that enjoys a lower export tax.
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