Indonesia prepares to execute B40 in January

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

B40 will need additional 3 mln loads feedstock, GAPKI says

Malaysia palm oil criteria at highest because mid-2022

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

(Adds analyst remarks, updates Malaysia's 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 mandate, industry experts said.

The palm oil benchmark price in Malaysia has risen more than 35% this year, raised 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 heaps compared with an approximated drop of just 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 company Oil World, stated he anticipates 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 forecast to improve, provide from in other places and of other veggie oils is seen tightening.

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

"We would need a recovery in palm in 2025 because combined exports of soya, sunflower and rapeseed oils are decreasing," Mielke stated.

'FRIGHTENING' PRICE SURGE

The rate rise in palm oil in the previous 7 weeks has been "frightening" for purchasers, Mielke said, including 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 tons will be needed for B40 implementation, wearing down export supply.

The present palm oil premium has already triggered 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 approximated.

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

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

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

Mielke and Mistry urged Indonesia to

consider postponing

B40 implementation on concern about its impact on food customers.

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

import responsibility hike

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