Indonesia prepares to B40 in January

In that case, prices might rally 10%-15% in Jan-March, Mielke says

B40 will require additional 3 mln tons feedstock, GAPKI says

Malaysia palm oil criteria at highest because mid-2022

India might withdraw import tax trek amidst inflation, Mistry says

(Adds analyst 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 recover in 2025 after an anticipated drop this year, but costs are expected to stay raised due to scheduled expansion of the nation's biodiesel mandate, market experts said.

The palm oil criteria rate in Malaysia has actually risen more than 35% this year, lifted by sluggish output and Indonesia's plan to increase the mandatory domestic biodiesel blend 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 recuperate by 1.5 million metric heaps compared with an approximated drop of just 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 study company Oil World, said he expects Indonesia's palm oil production to increase by as much as 2 million heaps next year after a 2.5 million heap drop in 2024.

While Indonesia's output is forecast to improve, supply from elsewhere 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 estimated 1 million lots in 2024.

"We would require a healing in palm in 2025 because combined exports of soya, sunflower and rapeseed oils are declining," Mielke stated.

'FRIGHTENING' PRICE SURGE

The cost surge in palm oil in the past seven weeks has been "frightening" for buyers, Mielke said, including 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 tons will be needed for B40 implementation, wearing down export supply.

The present palm oil premium has actually already triggered palm to lose market share versus 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 because mid-2022.

"Sentiment right now is red-hot and extremely bullish, we have to be mindful," said Dorab Mistry, director at Indian durable goods business Godrej International.

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

Mielke and Mistry urged Indonesia to

consider delaying

B40 execution on issue about its effect on food customers.

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

import responsibility 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)