Indonesia plans to carry out B40 in January

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

B40 will require extra 3 mln lots feedstock, GAPKI states

Malaysia palm at highest considering that mid-2022

India might withdraw import tax trek in the middle of inflation, Mistry says

(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 costs are expected to remain elevated due to planned growth of the country's biodiesel required, market experts stated.

The palm oil criteria rate in Malaysia has increased more than 35% this year, raised by sluggish output and Indonesia's plan to increase the obligatory domestic biodiesel mix to 40% in January from 35% now in an effort to minimize fuel imports.

Palm oil output next year in leading producer Indonesia is anticipated to recover by 1.5 million metric heaps compared with a projected drop of simply over a million loads this year, Julian McGill, handling director at Glenauk Economics, told 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 loads next year after a 2.5 million lot drop in 2024.

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

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

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

'FRIGHTENING' PRICE SURGE

The price surge in palm oil in the previous 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 said additional feedstock of around 3 million heaps will be required for B40 execution, eroding export supply.

The present palm oil premium has actually already triggered 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 estimated.

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

"Sentiment today is red-hot and incredibly bullish, we have to be careful," said Dorab Mistry, director at Indian consumer items business Godrej International.

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

Mielke and Mistry urged Indonesia to

consider postponing

B40 execution on issue about its effect on food customers.

Meanwhile, Mistry expected leading 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)