Indonesia plans to B40 in January
In that case, costs may rally 10%-15% in Jan-March, Mielke states
B40 will require additional 3 mln loads feedstock, GAPKI states
Malaysia palm oil criteria at highest since mid-2022
India might withdraw import tax hike amid inflation, Mistry says
(Adds analyst remarks, updates Malaysia's palm oil criteria rate)
By Bernadette Christina
NUSA DUA, Indonesia, Nov 8 (Reuters) - Indonesia's palm oil output is forecast to recuperate in 2025 after an anticipated drop this year, however costs are anticipated to stay raised due to scheduled growth of the nation's biodiesel required, market experts stated.
The palm oil criteria rate in Malaysia has risen more than 35% this year, raised by sluggish output and Indonesia's strategy to increase the obligatory domestic biodiesel blend to 40% in January from 35% now in an effort to reduce fuel imports.
Palm oil output next year in leading manufacturer Indonesia is anticipated to recover by 1.5 million metric tons compared with an approximated 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 company Oil World, said he anticipates Indonesia's palm oil production to increase by as much as 2 million tons next year after a 2.5 million load drop in 2024.
While Indonesia's output is forecast to improve, supply from somewhere else 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 approximated 1 million lots in 2024.
"We would need a healing in palm in 2025 since combined exports of soya, sunflower and rapeseed oils are declining," Mielke said.
'FRIGHTENING' PRICE SURGE
The price surge in palm oil in the past 7 weeks has actually been "frightening" for buyers, Mielke said, including that it would rally by 10%-15% in January-March if Indonesia implements the so-called B40 policy.
The Indonesia Palm Oil Association said additional feedstock of around 3 million tons will be required for B40 application, wearing down export supply.
The current palm oil premium has actually currently caused palm to lose market share versus other oils, Mielke included.
Malaysian palm oil prices are seen trading at around $950 to $1,050 per metric ton in 2025, McGill of Glenauk approximated.
Benchmark Malaysian palm oil touched 5,104 ringgit ($1,165.30) on Friday, the highest because mid-2022.
"Sentiment right now is red-hot and exceptionally bullish, we have to be mindful," said Dorab Mistry, director at Indian durable goods business Godrej International.
He anticipated the Malaysian price around 5,000 ringgit and above till June 2025.
Mielke and Mistry prompted Indonesia to
think about delaying
B40 implementation on concern about its effect on food customers.
Meanwhile, Mistry expected 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
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Indonesia Palm Oil Output Seen Recovering in 2025, However Biodiesel
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