Indonesia prepares to implement B40 in January

Because case, costs might rally 10%-15% in Jan-March, Mielke says

B40 will require extra 3 mln tons feedstock, GAPKI states

Malaysia palm oil benchmark at greatest given that mid-2022

India might withdraw import amidst inflation, Mistry states

(Adds expert comments, updates Malaysia's palm oil criteria rate)

By Bernadette Christina

NUSA DUA, Indonesia, Nov 8 (Reuters) - Indonesia's palm oil output is anticipated to recuperate in 2025 after an expected drop this year, but prices are anticipated to remain elevated due to scheduled growth of the country's biodiesel mandate, market experts said.

The palm oil benchmark price in Malaysia has actually increased more than 35% this year, lifted by sluggish output and Indonesia's plan to increase the mandatory domestic biodiesel blend to 40% in January from 35% now in an effort to decrease fuel imports.

Palm oil output next year in leading producer Indonesia is anticipated to recuperate by 1.5 million metric loads compared with an approximated drop of simply over a million tons this year, Julian McGill, managing director at Glenauk Economics, told the Indonesia Palm Oil Conference on Friday.

Thomas Mielke, head of Hamburg-based research study firm Oil World, said he expects Indonesia's palm oil production to increase by as much as 2 million tons next year after a 2.5 million lot drop in 2024.

While Indonesia's output is forecast to improve, supply from elsewhere and of other vegetable oils is seen tightening up.

Palm oil output in neighbouring Malaysia is anticipated to dip slightly next year after increasing by an approximated 1 million tons in 2024.

"We would require a recovery in palm in 2025 due to the fact that combined exports of soya, sunflower and rapeseed oils are declining," Mielke stated.

'FRIGHTENING' PRICE SURGE

The cost rise in palm oil in the previous seven weeks has been "frightening" for purchasers, Mielke said, including that it would rally by 10%-15% in January-March if Indonesia enforces the so-called B40 policy.

The Indonesia Palm Oil Association stated extra feedstock of around 3 million lots will be needed for B40 implementation, deteriorating export supply.

The current palm oil premium has actually already caused palm to lose market share versus other oils, Mielke added.

Malaysian palm oil costs are seen trading at around $950 to $1,050 per metric heap in 2025, McGill of Glenauk estimated.

Benchmark Malaysian palm oil touched 5,104 ringgit ($1,165.30) on Friday, the greatest since mid-2022.

"Sentiment right now is red-hot and exceptionally bullish, we need to be careful," said Dorab Mistry, director at Indian customer products business Godrej International.

He anticipated the Malaysian cost around 5,000 ringgit and above till June 2025.

Mielke and Mistry advised Indonesia to

think about delaying

B40 implementation on concern about its effect on food consumers.

Meanwhile, Mistry anticipated top palm oil importer India to withdraw its

import responsibility hike

imposed from September after elections in the state of Maharashtra in November. ($1 = 4.3800 ringgit) (Reporting by Bernadette Christina Munthe Writing by Fransiska Nangoy