KUALA LUMPUR, Feb. 12 (Xinhua) -- Malaysia, the second largest palm oil producer in the world, saw its palm oil stocks in January fall 6.75 percent month on month to 2.55 million tonnes.

According to the Malaysian Palm Oil Board data Monday, the crude palm oil (CPO) stock dropped by 5.72 percent to 1.57 million tonnes from a month earlier.

The CPO production also slumped 13.49 percent month on month to 1.59 million tonnes.

Meanwhile, the palm oil export increased by 6.01 percent month on month to 1.51 million tonnes.

Despite the palm inventory shrank, RAM Ratings said in a statement Monday that it reiterated that CPO prices would likely to soften to 2,300 to 2,500 ringgit (583 to 634 U.S. dollars) per tonne this year, from 2,783 per tonne last year.

This was due to production normalized and outstripped demand growth, said the Malaysian rating agency.

The abundant supply of vegetable oils and high CPO inventory levels in both Malaysia and Indonesia would also suppress CPO prices, it added.