KUALA LUMPUR, March 12 (Reuters) - - Malaysia's palm oil stocks rose unexpectedly in February as a decline in exports outpaced a fall in output, industry regulator Malaysian Palm Oil Board said on Monday, potentially weighing on prices.
Stocks in the world's No.2 producer of the edible oil rose 2 percent to 2.06 million tonnes from January, going against market expectations for a 3 percent drop and snapping four straight months of declines.
Inventories at above 2 million tonnes suggest Malaysia has been losing market share to Indonesia, which has been offering discounts on cargoes after Jakarta slashed export taxes for refined product cargoes.
Although ample stocks in Malaysia can shore up global edible oil supply in the wake of erratic weather affecting South American soy crops, palm oil futures may come under pressure after slipping 0.2 percent ahead of the data release.
"A few people are going to get caught out," said a trader with a foreign commodities brokerage in Kuala Lumpur as the market had been rallying on expectations of strong Asian demand chasing limited edible oil output growth.
Stocks in the world's No.2 producer of the edible oil rose 2 percent to 2.06 million tonnes from January, going against market expectations for a 3 percent drop and snapping four straight months of declines.
Inventories at above 2 million tonnes suggest Malaysia has been losing market share to Indonesia, which has been offering discounts on cargoes after Jakarta slashed export taxes for refined product cargoes.
Although ample stocks in Malaysia can shore up global edible oil supply in the wake of erratic weather affecting South American soy crops, palm oil futures may come under pressure after slipping 0.2 percent ahead of the data release.
"A few people are going to get caught out," said a trader with a foreign commodities brokerage in Kuala Lumpur as the market had been rallying on expectations of strong Asian demand chasing limited edible oil output growth.
