Indonesia prepares to implement B40 in January
In that case, costs may rally 10%-15% in Jan-March, Mielke says
B40 will require extra 3 mln lots feedstock, GAPKI says
Malaysia palm oil standard at highest since mid-2022
India might withdraw import tax hike in the middle of inflation, Mistry says
(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 recover in 2025 after an expected drop this year, but costs are anticipated to remain raised due to scheduled expansion of the country's biodiesel required, market analysts said.
The palm oil benchmark cost in Malaysia has actually increased more than 35% this year, raised by sluggish output and Indonesia's plan to increase the mandatory domestic biodiesel mix to 40% in January from 35% now in an effort to minimize fuel imports.
Palm oil output next year in top manufacturer Indonesia is anticipated to recuperate by 1.5 million metric heaps compared with an approximated drop of just over a million tons this year, Julian McGill, managing director at Glenauk Economics, told the Indonesia Palm Oil Conference on Friday.
Thomas Mielke, head of Hamburg-based research study company Oil World, stated he anticipates Indonesia's palm oil production to increase by as much as 2 million loads next year after a 2.5 million lot drop in 2024.
While Indonesia's output is anticipated to enhance, supply from elsewhere and of other vegetable oils is seen tightening.
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 due to the fact that combined exports of soya, sunflower and rapeseed oils are decreasing," Mielke stated.
'FRIGHTENING' PRICE SURGE
The price rise in palm oil in the previous 7 weeks has been "frightening" for buyers, Mielke stated, 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 additional feedstock of around 3 million heaps will be needed for B40 application, wearing down export supply.
The present palm oil premium has 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 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 extremely bullish, we need to take care," stated Dorab Mistry, director at Indian durable goods company Godrej International.
He forecast the Malaysian cost around 5,000 ringgit and above until June 2025.
Mielke and Mistry urged Indonesia to
think about postponing
B40 execution on concern about its influence on .
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
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Indonesia Palm Oil Output Seen Recovering in 2025, but Biodiesel
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