Indonesia plans to execute B40 in January

In that case, rates might rally 10%-15% in Jan-March, Mielke states

B40 will require additional 3 mln lots feedstock, GAPKI states

Malaysia palm oil benchmark at highest considering that mid-2022

India might withdraw import tax hike amid inflation, Mistry states

(Adds expert remarks, updates Malaysia's palm oil benchmark cost)

By Bernadette Christina

NUSA DUA, Indonesia, Nov 8 (Reuters) - Indonesia's palm oil output is forecast to recover in 2025 after an expected drop this year, however prices are expected to stay raised due to scheduled expansion of the nation's biodiesel mandate, industry analysts stated.

The palm oil standard price in Malaysia has actually increased more than 35% this year, raised 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 decrease fuel imports.

Palm oil output next year in leading manufacturer Indonesia is anticipated to recover by 1.5 million metric loads compared to a projected drop of just over a million heaps this year, Julian McGill, managing director at Glenauk Economics, told the Indonesia Palm Oil Conference on Friday.

Thomas Mielke, head of Hamburg-based research company 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 heap drop in 2024.

While Indonesia's output is forecast to improve, supply from somewhere else and of other vegetable oils is seen tightening up.

Palm oil output in neighbouring Malaysia is anticipated to dip slightly next year after increasing by an estimated 1 million lots in 2024.

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

'FRIGHTENING' PRICE SURGE

The cost rise 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 implements the so-called B40 policy.

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

The present palm oil premium has currently to lose market share against other oils, Mielke added.

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

Benchmark Malaysian palm oil touched 5,104 ringgit ($1,165.30) on Friday, the greatest because mid-2022.

"Sentiment today is red-hot and exceptionally bullish, we have to beware," said Dorab Mistry, director at Indian customer goods company Godrej International.

He anticipated the Malaysian rate around 5,000 ringgit and above till June 2025.

Mielke and Mistry prompted Indonesia to

think about postponing

B40 application on issue about its influence on food customers.

Meanwhile, Mistry anticipated top palm oil importer India to withdraw its

import duty 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