KUALA LUMPUR: Malaysia’s palm oil stockpiles stood at a four-year high at the end of October despite more-than-expected exports, data from the Malaysian Palm Oil Board (MPOB) showed on Friday.

Inventories rose 5.84% from September to 2.45 million metric tons, the sixth consecutive month of increases at the world’s second-largest palm oil producer.

The last time inventories jumped to this level was in September 2019.

Crude palm oil production climbed 5.89% to 1.94 million tons in October, while palm oil exports increased to 1.47 million tons, the data showed.

A Reuters survey had forecast inventories at 2.56 million, or growth of 10.82% on the month, and saw production at 1.88 million tons and exports at 1.29 million tons.

Stockpiles are expected to peak with end-October inventories, as production could decline in November due to seasonal rains hampering harvests, a Kuala Lumpur-based trader said.

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“From November, end stocks may start to decline, and this could hold crude palm oil prices from dropping below 3,500 ringgit levels,” the trader said.

Palm oil demand is showing a notable improvement of between 100,000 to 170,000 tons compared to prior forecasts, Marcello Cultrera of Singapore-based Apricus said.

“This demand is supported by periodic improvements in crude palm oil import parities and destinations import margins, inline with increased domestic consumption.”