Indonesia plans to implement B40 in January

In that case, prices might rally 10%-15% in Jan-March, Mielke states

B40 will require additional 3 mln heaps feedstock, GAPKI says

Malaysia palm oil standard at highest given that mid-2022

India might withdraw import tax trek amidst inflation, Mistry states

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

By Bernadette Christina

NUSA DUA, Indonesia, Nov 8 (Reuters) - Indonesia’s palm oil output is anticipated to recover in 2025 after an anticipated drop this year, however costs are expected to stay elevated due to organized growth of the country’s biodiesel required, market analysts stated.

The palm oil standard price in Malaysia has increased more than 35% this year, lifted by slow output and Indonesia’s plan 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 producer Indonesia is anticipated to recuperate by 1.5 million metric heaps compared with an estimated drop of just over a million heaps this year, Julian McGill, handling director at Glenauk Economics, informed the Indonesia Palm Oil Conference on Friday.

Thomas Mielke, head of Hamburg-based research World, stated he expects Indonesia’s palm oil production to increase by as much as 2 million tons next year after a 2.5 million load drop in 2024.

While Indonesia’s output is anticipated 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 heaps in 2024.

“We would require a recovery in palm in 2025 since combined exports of soya, sunflower and rapeseed oils are decreasing,” Mielke said.

‘FRIGHTENING’ PRICE SURGE

The price surge in palm oil in the past 7 weeks has actually been “frightening” for buyers, Mielke said, adding that it would rally by 10%-15% in January-March if Indonesia imposes the so-called B40 policy.

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

The current palm oil premium has actually currently caused palm to lose market share versus other oils, Mielke included.

Malaysian palm oil costs are seen trading at around $950 to $1,050 per metric lot in 2025, McGill of Glenauk estimated.

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

“Sentiment right now is red-hot and exceptionally bullish, we need to take care,” stated Dorab Mistry, director at Indian durable goods company Godrej International.

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

Mielke and Mistry urged Indonesia to

think about postponing

B40 application on issue about its influence on food consumers.

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

import duty 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