Malaysia's palm oil exports could decline for a third consecutive month in June as buyers increasingly turn to lower-priced Indonesian supplies, Bloomberg News reported Thursday.
The pressure comes as Indonesia begins shifting export activities to state-owned PT Danantara Sumberdaya Indonesia, while permitting producers to continue transactions during the transition period, according to the report.
Expectations that the policy overhaul would redirect demand to Malaysia have yet to materialize, as major buyers, particularly India, had already built inventories earlier this year, Bloomberg reported, citing Paramalingam Supramaniam, a director at brokerage Pelindung Bestari.
He said increased Indonesian exports during the transition period could intensify competition and further pressure Malaysian shipments.
(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)