Indonesia prepares to carry out B40 in January
In that case, rates might rally 10%-15% in Jan-March, Mielke states
B40 will
require additional 3 mln tons feedstock, GAPKI states
Malaysia palm oil
benchmark at highest since mid-2022
India might
withdraw import tax hike amid inflation, Mistry states
(Adds expert remarks,
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, but costs are expected to remain raised due to scheduled expansion of the country's
biodiesel required, industry experts stated.
The
palm oil criteria rate in Malaysia has increased more than 35% this year, lifted by slow output and
Indonesia's plan to
increase the necessary
domestic biodiesel mix 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
recover by 1.5 million metric lots compared to an estimated drop of just over a million heaps 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, stated he anticipates Indonesia's palm oil production to increase by as much as 2 million loads next year after a 2.5 million lot drop in 2024.
While Indonesia's output is forecast to enhance, provide from in other places and of other vegetable oils is seen tightening up.
Palm oil output in neighbouring Malaysia is expected to dip a little next year after increasing by an estimated 1 million lots 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
rate rise in palm oil in the previous 7 weeks has been "frightening" for buyers, Mielke said, including that it would rally by 10%-15% in January-March if Indonesia enforces the so-called B40 policy.
The Indonesia Palm Oil Association stated extra feedstock of around 3 million lots will be needed for B40 application, eroding export supply.
The
current palm oil premium has actually currently 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 ton 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 have to take care," said Dorab Mistry, director at
Indian durable goods company Godrej International.
He anticipated the Malaysian rate around 5,000
ringgit and above up until June 2025.
Mielke and Mistry prompted Indonesia to
think about postponing
B40 execution on issue about its
influence on food consumers.
Meanwhile, Mistry expected top palm oil importer India to
withdraw its
import duty 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; Editing by John Mair, Jane Merriman and Daren Butler)
