Indonesia plans to carry out B40 in January
In that case, rates may rally 10%-15% in Jan-March, Mielke says
B40 will require extra 3 mln heaps feedstock, GAPKI says
Malaysia palm oil standard at greatest given that mid-2022
India may withdraw import tax hike amid inflation, Mistry says
(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 anticipated to recover in 2025 after an anticipated drop this year, however prices are anticipated to remain elevated due to planned expansion of the nation's biodiesel required, market experts stated.
The palm oil standard rate in Malaysia has increased more than 35% this year, lifted by slow output and Indonesia's strategy to increase the necessary 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 expected to recover by 1.5 million metric loads compared with an estimated drop of just 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 company Oil World, stated he expects Indonesia's palm oil production to increase by as much as 2 million loads next year after a 2.5 million load drop in 2024.
While Indonesia's output is to improve, supply from somewhere else and of other vegetable 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 need a healing in palm in 2025 due to the fact that combined exports of soya, sunflower and rapeseed oils are decreasing," Mielke said.
'FRIGHTENING' PRICE SURGE
The rate surge in palm oil in the previous 7 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 lots will be required for B40 execution, eroding export supply.
The existing palm oil premium has actually already triggered 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 highest since mid-2022.
"Sentiment right now is red-hot and extremely bullish, we have to be mindful," said Dorab Mistry, director at Indian customer goods company Godrej International.
He forecast the Malaysian cost around 5,000 ringgit and above up until June 2025.
Mielke and Mistry advised Indonesia to
think about delaying
B40 implementation on concern about its influence on food customers.
Meanwhile, Mistry anticipated top palm oil importer India to withdraw its
import responsibility walking
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
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Indonesia Palm Oil Output Seen Recovering in 2025, However Biodiesel
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