Malaysia's palm oil exports hit a three year high in June as its inventory dropped by some 80,000 tons.
According to official data, Malaysian palm oil exports to their highest since 2008 showed signs of tailing off, after preventing the second-ranked producer of the oilseed raising inventories last month as far as had been expected.
Malaysia's palm oil stocks rose 6.8% to 2.05m tonnes, month on month, in June, official data showed.
However, the inventory figure, while the highest in 18 months, came in some 80,000 tonnes short of forecasts, restrained by exports which rose 12.4% to 1.58m tonnes.
The figure for shipments was the highest since December 2008, and helped by price declines for the vegetable oil last month, alongside those of other agricultural commodities, at a time when demand from importers is often strong ahead of the Ramadan festival.
However, data from cargo surveyor Societe Generale de Surveillance showed Malaysian palm exports falling 3.3% so far this month, weakened in particular by shipments to the US and to India, which vies with India for top rank in vegetable oil imports.
Exports to India, which at 44,500 tonnes so far in July were down nearly 50% on those during the first 10 days of June, are coming under seasonal pressure. India is starting the crush of its own harvest of oilseeds such as rapeseed.
Meanwhile, Malaysian palm inventories are expected to come under further upward pressure from a rise in output to a seasonal peak in the autumn, an increase which is being helped this year by the passing of the La Nina weather threat, and of the El Nino which preceded it.
Malaysia's palm production last month was, at 1.75m tonnes, the highest since October 2009.
Palm oil for September delivery, Kuala Lumpur's benchmark contract, lost early gains to stand down 0.4% at 3,064 ringgit in late deals.
