Malaysia Palm Oil Stocks Reach Two-Year High Amid Rising Production

Malaysia's palm oil stocks have risen for the fifth consecutive month, reaching their highest level in nearly two years due to production growth outpacing exports. In July 2025, inventories increased 4.02% to 2.11 million metric tons, while crude palm oil production rose 7.09% to 1.81 million tons, the highest since September 2024. Although exports recovered by 3.82% to 1.31 million tons after a sharp decline in June, aggressive discount selling by Indonesia capped Malaysian exports. However, Indonesian plans to raise export taxes in August are expected to boost Malaysian exports, which already rose 23.3% in the first ten days of August compared to July. Despite higher inventories, market analysts suggest the stock rise is manageable due to underperformance in August production and increasing exports. Additionally, stronger edible oil prices and festive demand from India support a rally in Malaysian palm oil futures to their highest level since early April.