KUALA LUMPUR (June 10): Malaysian palm oil inventory rose 2.51% in May from a month earlier as export growth significantly outpaced crude palm oil (CPO) output rise, according to the Malaysian Palm Oil Board (MPOB).

In a statement today, MPOB said inventory, comprising CPO and processed palm oil, rose to 2.24 million tonnes from 2.19 million tonnes. Exports jumped 37.3% to 1.61 million tonnes from 1.18 million tonnes.

MPOB said CPO output climbed 6.92% to 1.81 million tonnes from 1.69 million tonnes.

In April, palm oil inventory rose 17.34% while exports climbed 0.98%. CPO production was 13.26% higher.

May inventory, export and output growth came in higher than the market's median forecast, based on a Reuters survey.

Earlier, Reuters reported that palm oil stocks in Malaysia, the world's second-largest producer, were forecast to fall 2.4% from a month ago to 2.14 million tonnes, according to a median survey of six planters, traders and analysts.

The drop was attributed to a jump in export demand as key buyers snapped up supplies ahead of the Ramadan festive season, helped by a removal of Malaysian export taxes on CPO.

The poll forecast palm oil exports jumped 36.6%, their largest month-on-month rise since October 2006.

CPO production was forecast to rise 5.6% to 1.79 million tonnes from April, suggesting a steady recovery from tree stress and crop-unfriendly weather that hindered yields between November and February.