Indonesia plans to execute B40 in January

In that case, prices may rally 10%-15% in Jan-March, Mielke says

B40 will require additional 3 mln lots feedstock, GAPKI states

Malaysia palm oil criteria at greatest considering that mid-2022

India might withdraw import tax hike 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 anticipated to recover in 2025 after an expected drop this year, but rates are expected to remain elevated due to organized expansion of the biodiesel required, market experts stated.

The palm oil benchmark rate in Malaysia has actually increased 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 producer Indonesia is expected to recover by 1.5 million metric heaps compared to a projected drop of just over a million tons this year, Julian McGill, handling director at Glenauk Economics, informed the Indonesia Palm Oil Conference on Friday.

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

While Indonesia's output is anticipated to enhance, provide from in other places and of other vegetable oils is seen tightening.

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

"We would need a healing 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 rate rise in palm oil in the previous 7 weeks has actually been "frightening" for buyers, Mielke stated, adding that it would rally by 10%-15% in January-March if Indonesia imposes the so-called B40 policy.

The Indonesia Palm Oil Association stated extra feedstock of around 3 million loads will be required for B40 application, deteriorating export supply.

The present palm oil premium has actually already triggered 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 ton in 2025, McGill of Glenauk estimated.

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

"Sentiment right now is red-hot and very bullish, we need to beware," stated Dorab Mistry, director at Indian durable goods business Godrej International.

He forecast the Malaysian price around 5,000 ringgit and above until June 2025.

Mielke and Mistry urged Indonesia to

think about postponing

B40 execution on concern about its influence on food customers.

Meanwhile, Mistry expected leading palm oil importer India to withdraw its

import responsibility walking

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