Indonesia plans to carry out B40 in January
Because case, prices might rally 10%-15% in Jan-March, Mielke says
B40 will need extra 3 mln tons feedstock, GAPKI states
Malaysia palm oil criteria at highest because mid-2022
India might withdraw import tax trek amidst inflation, Mistry says
(Adds expert comments, 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 prices are expected to stay elevated due to scheduled growth of the country's biodiesel mandate, market analysts stated.
The palm oil standard rate in Malaysia has risen more than 35% this year, lifted by slow output and Indonesia's strategy to increase the mandatory domestic biodiesel mix to 40% in January from 35% now in an effort to lower fuel imports.
Palm oil output next year in leading manufacturer Indonesia is expected to recover by 1.5 million metric tons compared with an approximated drop of just over a million heaps this year, Julian McGill, handling director at Glenauk Economics, told the Indonesia Palm Oil Conference on Friday.
Thomas Mielke, head of Hamburg-based research company Oil World, said he expects Indonesia's palm oil production to increase by as much as 2 million lots next year after a 2.5 million lot drop in 2024.
While Indonesia's output is anticipated to improve, provide from somewhere else 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 lots in 2024.
"We would require a healing in palm in 2025 because combined exports of soya, sunflower and rapeseed oils are declining," Mielke said.
'FRIGHTENING' PRICE SURGE
The rate surge in palm oil in the past 7 weeks has been "frightening" for purchasers, 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 additional feedstock of around 3 million tons will be required for B40 execution, wearing down export supply.
The existing palm oil has already caused palm to lose market share against other oils, Mielke included.
Malaysian palm oil prices 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 given that mid-2022.
"Sentiment today is red-hot and exceptionally bullish, we have to take care," said Dorab Mistry, director at Indian durable goods business Godrej International.
He anticipated the Malaysian price around 5,000 ringgit and above until June 2025.
Mielke and Mistry advised Indonesia to
consider postponing
B40 application on issue about its effect on food customers.
Meanwhile, Mistry anticipated leading palm oil importer India to withdraw its
import responsibility walking
enforced 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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