Indonesia plans to carry out B40 in January
In that case, costs might rally 10%-15% in Jan-March, Mielke says
B40 will need additional 3 mln tons feedstock, GAPKI says
Malaysia palm oil criteria at greatest given that mid-2022
India may withdraw import tax hike amidst inflation, Mistry states
(Adds 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, however prices are anticipated to stay elevated due to scheduled growth of the nation's biodiesel required, market analysts said.
The palm oil benchmark price 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 leading producer Indonesia is expected to recover by 1.5 million metric tons compared with an estimated 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 firm Oil World, said he expects 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 anticipated to enhance, provide from somewhere else and of other vegetable 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 since combined exports of soya, sunflower and rapeseed oils are declining," Mielke said.
'FRIGHTENING' PRICE SURGE
The cost surge in palm oil in the past seven weeks has actually been "frightening" for buyers, 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 tons will be required for B40 implementation, eroding export supply.
The existing palm oil premium has currently caused palm to lose market share versus 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 estimated.
Benchmark Malaysian palm oil touched 5,104 ringgit ($1,165.30) on Friday, the greatest given that mid-2022.
"Sentiment today is red-hot and extremely bullish, we have to be mindful," stated Dorab Mistry, director at Indian customer items business Godrej International.
He anticipated the Malaysian price around 5,000 ringgit and above till June 2025.
Mielke and Mistry urged Indonesia to
consider postponing
B40 implementation on concern about its influence on food customers.
Meanwhile, Mistry anticipated leading palm oil importer India to withdraw its
import task 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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