Indonesia prepares to carry out B40 in January

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

B40 will need extra 3 mln lots feedstock, GAPKI says

Malaysia palm oil criteria at greatest because mid-2022

India might withdraw import tax trek amidst inflation, Mistry states

(Adds analyst comments, updates Malaysia's palm oil standard rate)

By Bernadette Christina

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

The palm oil benchmark rate in Malaysia has actually risen more than 35% this year, lifted by slow output and Indonesia's plan to increase the compulsory domestic biodiesel mix to 40% in January from 35% now in an effort to minimize fuel imports.

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

Thomas Mielke, head of Hamburg-based research study company Oil World, said 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 forecast to enhance, supply from elsewhere and of other vegetable oils is seen tightening up.

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

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

'FRIGHTENING' PRICE SURGE

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

The Indonesia Palm Oil Association said additional feedstock of around 3 million tons will be needed for B40 application, eroding export supply.

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

Malaysian palm oil prices 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 exceptionally bullish, we have to be careful," stated Dorab Mistry, director at Indian customer goods company Godrej International.

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

Mielke and Mistry urged Indonesia to

think about postponing

B40 application on concern about its effect on food customers.

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

import task 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; Editing by John Mair, Jane Merriman and Daren Butler)