Indonesia plans to implement B40 in January

Because case, costs may rally 10%-15% in Jan-March, Mielke states

B40 will require extra 3 mln lots feedstock, GAPKI states

Malaysia palm oil benchmark at highest given that mid-2022

India might withdraw import tax hike in the middle of inflation, Mistry states

(Adds remarks, updates Malaysia's palm oil criteria price)

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, but costs are anticipated to remain raised due to organized expansion of the nation's biodiesel required, market experts stated.

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

Palm oil output next year in leading producer Indonesia is expected to recover by 1.5 million metric tons compared with an estimated drop of simply over a million lots this year, Julian McGill, handling director at Glenauk Economics, told the Indonesia Palm Oil Conference on Friday.

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

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

Palm oil output in neighbouring Malaysia is expected to dip slightly next year after increasing by an approximated 1 million heaps 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 decreasing," Mielke stated.

'FRIGHTENING' PRICE SURGE

The price surge 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 implements the so-called B40 policy.

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

The current palm oil premium has currently caused palm to lose market share against other oils, Mielke added.

Malaysian palm oil rates 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 greatest considering that mid-2022.

"Sentiment today is red-hot and exceptionally bullish, we have to take care," stated Dorab Mistry, director at Indian durable goods business Godrej International.

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

Mielke and Mistry urged Indonesia to

consider postponing

B40 application on concern about its effect on food customers.

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

import task 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