Indonesia prepares to execute B40 in January

Because case, rates may rally 10%-15% in Jan-March, Mielke states

B40 will require extra 3 mln loads feedstock, GAPKI states

Malaysia palm oil benchmark at highest given that mid-2022

India might withdraw import tax hike amidst inflation, Mistry says

(Adds expert comments, updates Malaysia's palm oil criteria price)

By Bernadette Christina

NUSA DUA, Indonesia, Nov 8 (Reuters) - Indonesia's palm oil output is forecast to recover in 2025 after an anticipated drop this year, however prices are anticipated to remain raised due to scheduled growth of the country's biodiesel mandate, market analysts said.

The palm oil benchmark cost in Malaysia has actually risen more than 35% this year, lifted 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 lower fuel imports.

Palm oil output next year in top producer Indonesia is anticipated to recover by 1.5 million metric tons compared with an approximated drop of simply over a million lots 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, stated he anticipates Indonesia's palm oil production to increase by as much as 2 million tons next year after a 2.5 million heap drop in 2024.

While Indonesia's output is anticipated to improve, supply from elsewhere and of other veggie oils is seen tightening.

Palm oil output in neighbouring Malaysia is expected to dip somewhat next year after increasing by an approximated 1 million lots in 2024.

"We would need a healing in palm in 2025 since combined exports of soya, sunflower and rapeseed oils are declining," Mielke said.

'FRIGHTENING' PRICE SURGE

The cost rise in palm oil in the past seven weeks has been "frightening" for buyers, Mielke said, adding that it would rally by 10%-15% in January-March if Indonesia imposes the so-called B40 policy.

The Indonesia Palm Oil Association stated additional feedstock of around 3 million heaps will be needed for B40 implementation, wearing down export supply.

The present palm oil premium has already caused palm to lose market share against other oils, Mielke included.

Malaysian palm oil prices are seen trading at around $950 to $1,050 per metric load in 2025, McGill of Glenauk approximated.

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 exceptionally bullish, we need to take care," said Dorab Mistry, director at Indian consumer items business Godrej International.

He forecast the Malaysian cost around 5,000 ringgit and above up until June 2025.

Mielke and Mistry advised Indonesia to

think about delaying

B40 application on concern about its influence on food consumers.

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

import responsibility hike

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)