Indonesia plans to execute B40 in January
In that case, prices might rally 10%-15% in Jan-March, Mielke says
B40 will need additional 3 mln loads feedstock, GAPKI says
Malaysia palm oil benchmark at highest since mid-2022
India might withdraw import tax trek amidst inflation, Mistry states
(Adds analyst remarks, updates Malaysia's palm oil criteria cost)
By Bernadette Christina
NUSA DUA, Indonesia, Nov 8 (Reuters) - Indonesia's palm oil output is forecast to recuperate in 2025 after an anticipated drop this year, however rates are expected to stay elevated due to planned growth of the country's biodiesel required, industry experts said.
The palm oil benchmark rate in Malaysia has actually risen more than 35% this year, raised by sluggish output and Indonesia's strategy to increase the mandatory domestic biodiesel mix to 40% in January from 35% now in an effort to decrease fuel imports.
Palm oil output next year in leading manufacturer Indonesia is expected to recover by 1.5 million metric tons compared with an estimated drop of simply over a million heaps 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, stated he anticipates Indonesia's palm oil production to increase by as much as 2 million heaps next year after a 2.5 million load drop in 2024.
While Indonesia's output is forecast to enhance, provide from somewhere else and of other veggie oils is seen tightening.
Palm oil output in neighbouring Malaysia is expected to dip slightly next year after increasing by an approximated 1 million loads in 2024.
"We would need a recovery in palm in 2025 since combined exports of soya, sunflower and rapeseed oils are decreasing," Mielke said.
'FRIGHTENING' PRICE SURGE
The cost rise in palm oil in the past 7 weeks has been "frightening" for purchasers, Mielke said, including that it would rally by 10%-15% in January-March if Indonesia implements the so-called B40 policy.
The Indonesia Palm Oil Association stated additional feedstock of around 3 million heaps will be required for B40 application, eroding export supply.
The present palm oil premium has currently caused palm to lose market share versus other oils, Mielke added.
Malaysian palm oil rates 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 very bullish, we have to take care," said Dorab Mistry, director at Indian durable goods business Godrej International.
He forecast the Malaysian cost around 5,000 ringgit and above till June 2025.
Mielke and Mistry advised Indonesia to
think about delaying
B40 application on concern about its impact on food consumers.
Meanwhile, Mistry expected leading palm oil importer India to its
import duty 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
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Indonesia Palm Oil Output Seen Recovering in 2025, but Biodiesel
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