May 10, 2018 / 5:59 AM / 8 months ago

UPDATE 1-Malaysia's end-April palm stocks fall to 7-month low - MPOB

    * Malaysia palm stocks fall for fourth month
    * Exports dip, but still higher than forecast - Trader
    * Malaysian markets closed, to resume trading on Monday

 (Updates with details, background, quotes)
    KUALA LUMPUR, May 10 (Reuters) - Malaysia's palm oil
inventories fell to a seven-month low at end-April, declining
for a fourth straight month as exports and domestic consumption
outpaced production, official data showed on Thursday. 
    End-stocks in Malaysia, the world's second largest palm oil
producer, fell 6.4 percent to 2.17 million tonnes, the lowest
level since September, the Malaysian Palm Oil Board (MPOB)
reported. MYPOMS-TPO 
    Lower inventories could shore up benchmark palm oil prices
, which hit a 21-month low last week. Palm prices have
since edged higher, but ended down 0.1 percent at 2,381 ringgit
($603.09) a tonne on Tuesday.
    Malaysia's national stock exchange was closed on Wednesday
for national elections. It will remain closed through Friday due
to the announcement of special public holidays after Malaysia's
opposition alliance won power in a shock victory.
    "It looks like there's higher biofuel demand last month.
That explains the lower stocks level in the country," said David
Ng, derivatives specialist at Phillip Futures in Kuala Lumpur.
Higher biofuel demand increases palm oil consumption.
    "Overall we reckon the production pace has not been picking
up yet and stocks were mainly lower due to a sustained export
    Rising oil prices in recent weeks have made production of
biodiesel, in which crude palm oil is used as feedstock, more
economical. Gasoil's price spread over palm recently
widened to its highest in over three years, and was last around
$75 on Thursday.
    The MPOB data showed April output dipped 1 percent to 1.56
million tonnes from a month earlier, but was still the highest
April level since 2015. MYPOMP-CPOTT
    Exports slid 1.6 percent on-month to 1.54 million tonnes in
April, but were still above market expectations. MYPOME-PO
    "Exports came in better than expected, it could be because
of the duty exemption in April," said a palm oil futures trader
in Kuala Lumpur, referring to Malaysia's export tax exemption on
crude palm oil for four months.
    Malaysia had extended a tax exemption on crude palm oil from
January to April to cut inventories and support prices.

    A Thomson Reuters survey had forecast palm oil stockpiles to
fall 4.1 percent to 2.23 million tonnes in April. Production was
seen flat at 1.57 million tonnes, while exports were forecast to
fall 5.5 percent to 1.48 million tonnes.
    The following is a breakdown of Malaysian Palm Oil Board
figures and Reuters estimates for April:
    (volumes in tonnes)
          April 2018  April 2018 poll  April 2017   March 2018
 Output   1,558,337      1,574,000      1,548,026    1,573,957
 Stocks   2,174,243      2,229,273      1,600,126   2,323,497*
 Exports  1,541,432      1,480,000      1,284,120   1,565,668*
 Imports    35,624        37,500         54,475       39,626
 *denotes revised figures          

($1 = 3.9480 ringgit)

 (Reporting by Emily Chow; Editing by Sherry Jacob-Phillips and
Richard Pullin)
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