Indonesia Palm Oil Output Seen Recovering in 2025, However Biodiesel
Indonesia prepares to execute B40 in January
In that case, rates may rally 10%-15% in Jan-March, Mielke states
B40 will require extra 3 mln lots feedstock, GAPKI says
Malaysia palm oil standard at highest since mid-2022
India may withdraw import tax trek in the middle of inflation, Mistry states
(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 anticipated to recover in 2025 after an anticipated drop this year, however prices are anticipated to stay elevated due to scheduled growth of the country's biodiesel mandate, industry analysts said.
The palm oil standard rate in Malaysia has increased more than 35% this year, lifted by slow output and Indonesia's strategy to increase the obligatory domestic biodiesel mix to 40% in January from 35% now in an effort to lower fuel imports.
Palm oil output next year in leading manufacturer Indonesia is expected to recuperate by 1.5 million metric tons compared with a projected drop of simply over a million loads this year, Julian McGill, handling director at Glenauk Economics, informed the Indonesia Palm Oil Conference on Friday.
Thomas Mielke, head of Hamburg-based research firm Oil World, stated he expects Indonesia's palm oil production to increase by as much as 2 million loads next year after a 2.5 million ton drop in 2024.
While Indonesia's output is anticipated to improve, provide from somewhere else and of other vegetable oils is seen tightening up.
Palm oil output in neighbouring Malaysia is expected to dip somewhat next year after increasing by an approximated 1 million loads in 2024.
"We would need a healing in palm in 2025 due to the fact that combined exports of soya, sunflower and rapeseed oils are declining," Mielke said.
'FRIGHTENING' PRICE SURGE
The price surge in palm oil in the past 7 weeks has been "frightening" for purchasers, 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 lots will be required for B40 application, wearing down export supply.
The present palm oil premium has actually already caused palm to lose market share against other oils, Mielke added.
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 highest since mid-2022.
"Sentiment today is red-hot and very bullish, we need to beware," stated Dorab Mistry, director at Indian durable goods company Godrej International.
He anticipated the around 5,000 ringgit and above until June 2025.
Mielke and Mistry prompted 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; Editing by John Mair, Jane Merriman and Daren Butler)