Indonesia prepares to execute B40 in January

In that case, prices might rally 10%-15% in Jan-March, Mielke states

B40 will require additional 3 mln heaps feedstock, GAPKI states

Malaysia palm oil criteria at highest because mid-2022

India may withdraw import tax trek amid inflation, Mistry says

(Adds analyst comments, updates Malaysia's palm oil standard 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, but rates are expected to stay elevated due to scheduled growth of the nation's biodiesel required, market analysts stated.

The palm oil criteria rate in Malaysia has actually risen more than 35% this year, lifted by sluggish output and Indonesia's strategy to increase the necessary domestic biodiesel blend to 40% in January from 35% now in an effort to minimize fuel imports.

Palm oil output next year in top manufacturer Indonesia is expected to recuperate by 1.5 million metric heaps compared with an approximated drop of just over a million heaps this year, Julian McGill, handling 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 lot drop in 2024.

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

Palm oil output in neighbouring Malaysia is anticipated to dip a little next year after increasing by an approximated 1 million tons 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 said.

'FRIGHTENING' PRICE SURGE

The cost surge 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 said extra feedstock of around 3 million heaps will be required for B40 application, deteriorating export supply.

The existing palm oil premium has currently triggered palm to lose market share versus other oils, Mielke included.

Malaysian palm oil costs are seen trading at around $950 to $1,050 per metric lot 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 right now is red-hot and incredibly bullish, we need to beware," said Dorab Mistry, director at Indian customer goods business Godrej International.

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

Mielke and Indonesia to

think about postponing

B40 implementation on concern about its effect on food consumers.

Meanwhile, Mistry expected leading palm oil importer India to withdraw its

import responsibility walking

imposed from September after elections in the state of Maharashtra in November. ($1 = 4.3800 ringgit) (Reporting by Bernadette Christina Munthe Writing by Fransiska Nangoy; Editing by John Mair, Jane Merriman and Daren Butler)