Indonesia plans to execute B40 in January

Because case, rates might rally 10%-15% in Jan-March, Mielke says

B40 will require additional 3 mln loads feedstock, GAPKI states

Malaysia palm oil standard at highest considering that mid-2022

India might withdraw import tax trek amidst inflation, Mistry states

(Adds expert comments, updates Malaysia’s palm oil benchmark price)

By Bernadette Christina

NUSA DUA, Indonesia, Nov 8 (Reuters) - Indonesia’s palm oil output is forecast to in 2025 after an expected drop this year, however prices are expected to remain elevated due to scheduled growth of the country’s biodiesel required, industry analysts stated.

The palm oil standard price in Malaysia has actually increased more than 35% this year, raised by sluggish output and Indonesia’s strategy to increase the obligatory domestic biodiesel mix to 40% in January from 35% now in an effort to decrease fuel imports.

Palm oil output next year in top producer Indonesia is anticipated to recuperate by 1.5 million metric loads compared to a projected drop of just over a million lots this year, Julian McGill, managing 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 lot drop in 2024.

While Indonesia’s output is anticipated to improve, provide from elsewhere and of other veggie oils is seen tightening up.

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

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

‘FRIGHTENING’ PRICE SURGE

The price rise in palm oil in the previous seven weeks has 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 tons will be needed for B40 application, deteriorating export supply.

The existing palm oil premium has already caused palm to lose market share against other oils, Mielke included.

Malaysian palm oil prices are seen trading at around $950 to $1,050 per metric heap 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 today is red-hot and exceptionally bullish, we need to be cautious,” said Dorab Mistry, director at Indian durable goods company Godrej International.

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

Mielke and Mistry urged Indonesia to

consider postponing

B40 execution on issue about its effect on food customers.

Meanwhile, Mistry anticipated 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