Indonesia prepares to carry out B40 in January
Because case, prices may rally 10%-15% in Jan-March, Mielke states
B40 will require additional 3 mln loads feedstock, GAPKI states
Malaysia palm oil benchmark at highest given that mid-2022
India might withdraw import tax hike amid inflation, Mistry states
(Adds analyst comments, updates Malaysia's palm oil standard cost)
By Bernadette Christina
NUSA DUA, Indonesia, Nov 8 (Reuters) - Indonesia's palm oil output is 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 required, industry analysts said.
The palm oil benchmark cost in Malaysia has increased more than 35% this year, lifted 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 lower fuel imports.
Palm oil output next year in top manufacturer Indonesia is anticipated to recover by 1.5 million metric loads compared to an approximated drop of simply over a million lots this year, Julian McGill, handling director at Glenauk Economics, told the Indonesia Palm Oil Conference on Friday.
Thomas Mielke, head of Hamburg-based research firm 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 ton drop in 2024.
While Indonesia's output is forecast to enhance, provide from in other places and of other vegetable oils is seen tightening.
Palm oil output in neighbouring Malaysia is expected to dip a little next year after increasing by an estimated 1 million loads in 2024.
"We would require a healing in palm in 2025 since combined exports of soya, sunflower and rapeseed oils are declining," Mielke said.
'FRIGHTENING' PRICE SURGE
The rate surge in palm oil in the previous seven weeks has actually been "frightening" for purchasers, Mielke said, adding that it would rally by 10%-15% in January-March if Indonesia enforces the so-called B40 policy.
The Indonesia Palm Oil Association stated additional feedstock of around 3 million lots will be required for B40 implementation, eroding export supply.
The existing palm oil premium has already 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 heap in 2025, McGill of Glenauk estimated.
Benchmark Malaysian palm oil touched 5,104 ringgit ($1,165.30) on Friday, the greatest since mid-2022.
"Sentiment right now is red-hot and incredibly bullish, we need to take care," said Dorab Mistry, director at Indian customer products business Godrej International.
He anticipated the Malaysian cost around 5,000 ringgit and above up until June 2025.
Mielke and Mistry urged Indonesia to
think about delaying
B40 implementation on concern about its effect on food consumers.
Meanwhile, Mistry anticipated top 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
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Indonesia Palm Oil Output Seen Recovering in 2025, but Biodiesel
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