Malaysian Palm Oil Sector Sees Output Slip as Stocks Top 3 Million Tonnes

The latest data released by the Malaysian Palm Oil Board (MPOB) point to a mixed performance for the palm oil industry in December 2025, with production declining even as stocks and exports posted notable gains.

First: falling output and price pressure

Figures showed crude palm oil (CPO) production down 5.46% to 1,829,761 tonnes. The decline also weighed on fresh fruit bunch (FFB) prices, which slipped slightly by 2.15% to settle at 43.79 ringgit.

Second: rising stocks and the storage challenge

In a key indicator of market conditions, oil stocks rose across the board:

• Crude palm oil stocks: up 4.52% to 1,821,853 tonnes.
• Processed palm oil stocks: jumped sharply by 12.46% to 1,228,745 tonnes.
• Total palm oil stocks: climbed 7.58% to a record 3,050,598 tonnes.
• Palm kernel oil stocks: increased by 4.74%.

Third: foreign trade activity

On the positive side, Malaysian export activity picked up, with palm oil exports rising 8.52% to reach 1,316,522 tonnes. Imports, meanwhile, surged by 43.64%, though the overall volume remained limited at 33,292 tonnes.

Conclusion

The MPOB's December 2025 report points to a stock build-up outpacing the rate of drawdown through exports, despite the seasonal slowdown in production. This data could put corrective pressure on prices in global markets unless demand rises more strongly in the first quarter of 2026.

Source: Al Mal Forum