Malaysia palm oil stocks hit 11-month high

KUALA LUMPUR, Oct 10 (Reuters): Malaysia's palm oil stockpiles hit an 11-month high at the end of September, data from the Malaysian Palm Oil Board (MPOB) showed on Tuesday, raising concerns about demand for the commodity.

Inventories rose 9.6 per cent from August to 2.31 million tonnes, the fifth consecutive month of increases at the world's second-largest palm oil producer.

Crude palm oil output rose 4.33 per cent to 1.83 million tons in September, while exports dropped to 1.2 million tons, the data showed.

"The stocks rose in line with market expectations. The pace suggests inventories would rise further in Malaysia to 2.5 million tons by the end of December," said a Mumbai-based dealer with a global trading house.

Palm oil was struggling as rival oils are available at competitive prices, the dealer added.

Demand in India and China, the top two consumers of palm oil, is expected to moderate in the coming months as inventories have risen in those countries, another dealer said.

The MPOB data suggests Malaysian consumption nearly doubled month-on-month to 494,000 tons in September.