Indonesia prepares to implement B40 in January

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

B40 will require additional 3 mln tons feedstock, GAPKI says

Malaysia palm oil criteria at highest given that mid-2022

India might withdraw import tax hike amid inflation, Mistry states

(Adds expert remarks, updates Malaysia's palm oil standard cost)

By Bernadette Christina

NUSA DUA, Indonesia, Nov 8 (Reuters) - Indonesia's palm oil output is forecast to recuperate in 2025 after an expected drop this year, but prices are anticipated to remain raised due to planned growth of the country's biodiesel mandate, market experts said.

The palm oil benchmark cost in Malaysia has actually increased more than 35% this year, raised 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 minimize fuel imports.

Palm oil output next year in top producer Indonesia is expected to recover by 1.5 million metric heaps compared to an estimated drop of simply over a million heaps this year, Julian McGill, managing director at Glenauk Economics, told the Indonesia Palm Oil Conference on Friday.

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

While Indonesia's output is forecast to improve, supply from in other places and of other vegetable oils is seen tightening up.

Palm oil output in neighbouring Malaysia is anticipated 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 since combined exports of soya, sunflower and rapeseed oils are decreasing," Mielke said.

'FRIGHTENING' PRICE SURGE

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

The Indonesia Palm Oil Association stated extra feedstock of around 3 million lots will be required for B40 execution, deteriorating export supply.

The existing palm oil premium has actually already triggered palm to lose market share versus other oils, Mielke added.

Malaysian palm oil rates are seen trading at around $950 to $1,050 per metric load in 2025, McGill of Glenauk estimated.

Benchmark Malaysian palm oil touched 5,104 ringgit ($1,165.30) on Friday, the greatest considering that mid-2022.

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

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

Mielke and Mistry urged Indonesia to

think about postponing

B40 implementation on concern about its influence on food consumers.

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

import duty 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