Indonesia prepares to execute B40 in January

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

B40 will require extra 3 mln tons feedstock, GAPKI states

Malaysia palm oil criteria at greatest given that mid-2022

India may withdraw import tax trek amidst inflation, Mistry says

(Adds analyst remarks, updates Malaysia's palm oil benchmark 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 expected to remain elevated due to scheduled expansion of the country's biodiesel mandate, industry analysts stated.

The palm oil benchmark price in Malaysia has increased more than 35% this year, raised by sluggish output and Indonesia's strategy to increase the mandatory domestic biodiesel blend to 40% in January from 35% now in an effort to reduce fuel imports.

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

Thomas Mielke, head of Hamburg-based research study firm Oil World, stated he anticipates Indonesia's palm oil production to increase by as much as 2 million heaps next year after a 2.5 million ton drop in 2024.

While Indonesia's output is forecast to enhance, provide from elsewhere and of other veggie oils is seen tightening.

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

"We would require a recovery 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 rise in palm oil in the past seven weeks has actually been "frightening" for buyers, 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 stated extra feedstock of around 3 million tons will be needed for B40 application, deteriorating export supply.

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

Malaysian palm 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 greatest because mid-2022.

"Sentiment today is red-hot and exceptionally bullish, we have to beware," stated Dorab Mistry, director at Indian durable goods company Godrej International.

He forecast the Malaysian rate around 5,000 ringgit and above till June 2025.

Mielke and Mistry urged Indonesia to

think about postponing

B40 application on concern about its effect on food consumers.

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

import responsibility 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)