Indonesia prepares to implement B40 in January

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

B40 will 3 mln tons feedstock, GAPKI states

Malaysia palm oil standard at highest given that mid-2022

India may withdraw import tax hike amid 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 recover in 2025 after an expected drop this year, but rates are anticipated to remain elevated due to organized expansion of the nation's biodiesel required, industry analysts stated.

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

Palm oil output next year in leading manufacturer Indonesia is anticipated to recover by 1.5 million metric heaps compared to an approximated 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 company Oil 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 heap drop in 2024.

While Indonesia's output is anticipated to enhance, supply from in other places and of other veggie oils is seen tightening up.

Palm oil output in neighbouring Malaysia is anticipated to dip somewhat next year after increasing by an approximated 1 million loads in 2024.

"We would need a recovery in palm in 2025 due to the fact that combined exports of soya, sunflower and rapeseed oils are declining," Mielke said.

'FRIGHTENING' PRICE SURGE

The cost 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 imposes the so-called B40 policy.

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

The existing palm oil premium has actually currently triggered palm to lose market share against other oils, Mielke included.

Malaysian palm oil rates 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 right now is red-hot and exceptionally bullish, we need to beware," stated Dorab Mistry, director at Indian durable goods business Godrej International.

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

Mielke and Mistry prompted Indonesia to

think about delaying

B40 application on concern about its influence on food customers.

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

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