Indonesia plans to execute B40 in January
In that case, rates may rally 10%-15% in Jan-March, Mielke says
B40 will need additional 3 mln lots feedstock, GAPKI states
oil standard at greatest given that mid-2022
India might withdraw import tax hike amid inflation, Mistry states
(Adds analyst remarks, updates Malaysia's palm oil standard price)
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, but costs are anticipated to remain elevated due to organized expansion of the country's biodiesel mandate, industry analysts stated.
The palm oil benchmark cost in Malaysia has risen more than 35% this year, lifted by sluggish output and Indonesia's plan to increase the compulsory domestic biodiesel blend to 40% in January from 35% now in an effort to lower fuel imports.
Palm oil output next year in top manufacturer Indonesia is expected to recuperate by 1.5 million metric heaps compared with an estimated drop of simply over a million tons 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 heaps next year after a 2.5 million heap drop in 2024.
While Indonesia's output is anticipated to improve, supply from somewhere else and of other veggie oils is seen tightening up.
Palm oil output in neighbouring Malaysia is expected to dip slightly next year after increasing by an approximated 1 million heaps in 2024.
"We would need a recovery in palm in 2025 because combined exports of soya, sunflower and rapeseed oils are declining," Mielke said.
'FRIGHTENING' PRICE SURGE
The cost rise in palm oil in the past 7 weeks has actually been "frightening" for buyers, Mielke stated, adding that it would rally by 10%-15% in January-March if Indonesia implements the so-called B40 policy.
The Indonesia Palm Oil Association stated additional feedstock of around 3 million loads will be needed for B40 implementation, wearing down export supply.
The present palm oil premium has actually already triggered palm to lose market share against other oils, Mielke added.
Malaysian palm oil prices are seen trading at around $950 to $1,050 per metric lot in 2025, McGill of Glenauk approximated.
Benchmark Malaysian palm oil touched 5,104 ringgit ($1,165.30) on Friday, the highest since mid-2022.
"Sentiment right now is red-hot and incredibly bullish, we have to take care," said Dorab Mistry, director at Indian durable goods company Godrej International.
He anticipated the Malaysian price around 5,000 ringgit and above till June 2025.
Mielke and Mistry prompted Indonesia to
consider delaying
B40 execution on concern about its effect on food consumers.
Meanwhile, Mistry expected top palm oil importer India to withdraw its
import duty 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
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Indonesia Palm Oil Output Seen Recovering in 2025, but Biodiesel
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