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UPDATE 1-Malaysia end-Sept palm oil stocks up 1.2%, output rise lower-than-expected

    * Stockpile remains tight with only 1.24% monthly rise 
    * Rise in output, exports smaller than expected -analyst
    * Production on a declining trend for Q4 2020 -brokers 

 (Adds details, quotes, table)
    By Mei Mei Chu
    KUALA LUMPUR, Oct 12 (Reuters) - Malaysia's end-September
palm oil stockpile expanded 1.24% from the previous month to a
three-month high, as a surprisingly small advancement in output
and exports squeezed supply, according to industry regulator
data on Monday.
    Inventories in the world's second-largest producer rose to
1.73 million tonnes, the Malaysian Palm Oil Board (MPOB) said.
            
    Exports rose only 1.88% on-month to 1.61 million tonnes,
according to MPOB data, much lower than cargo surveyors'
estimates and a Reuters poll flagging a jump of between 6% to
11%.             
    "The first surprise is export is surprisingly low ...
Production is also lower than widely expected but stocks
continue to be tight," said Sathia Varqa, co-founder of
Singapore-based Palm Oil Analytics.
    Crude palm oil production also hit a three-month high,
despite inching up only 0.32% from August to 1.87 million
tonnes.              
    Production may have already peaked in June and will continue
to decline in the fourth quarter of the year, said Marcello
Cultrera, institutional sales manager and broker at Phillip
Futures in Kuala Lumpur. 
    "We might get tighter on a supply basis," he added.
    Palm and other vegetable oils are facing a "very bullish
scenario" as traders are mindful of the La Nina weather pattern
hurting yields, said Paramalingam Supramaniam, director at
Selangor-based brokerage Pelindung Bestari Sdn Bhd.
    "This bullish scenario in palm will continue unabated at
least until the first quarter of 2021," he added. 
    Following is a breakdown of the Malaysian Palm Oil Board
figures and Reuters estimates for September (volumes in tonnes):
            Sept 2020    Sept 2020 poll   Aug 2020*   Sept 2019
  Output    1,869,339      1,953,350      1,863,309   1,842,433
 Stocks     1,725,120      1,720,666      1,704,060   2,448,484
 Exports    1,612,169      1,679,500      1,582,359   1,409,089
 Imports      48,273         37,500        32,311       71,112
 *indicates revised figures by the Malaysian Palm Oil Board   
    
    

 (Reporting by Mei Mei Chu; Editing by Jacqueline Wong)
  
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