Malaysia to continue reducing palm oil production in December, says MPOV

Experts from the Malaysian Palm Oil Board (MPOB) predict that Malaysia's palm oil production will decline for the fourth consecutive month in December as heavy rains delayed the palm harvest, OleoScope reports.

Peninsular Malaysia, especially its northeast coast, and southern Thailand have been hit hard by torrential rains and floods that have destroyed homes and roads, damaged thousands of acres of rice crops and killed dozens of people. In the last five days of November, parts of Malaysia's east coast received more than a six-month rainfall.

"If weather conditions stabilize, crude palm oil (CPO) production will decrease by approximately 5-8%, but if bad weather continues, it could decrease by 10%-20%," the MPO believes.

The production cut will reduce palm oil stocks in Malaysia, leading to higher futures prices for the main raw material, which are already approaching a 2.5-year high.

Recall that in November, Malaysia reduced its SRO production by 9.8% compared to October to 1.62 million tons, which was the lowest monthly figure since 2020.