Indonesia plans to implement B40 in January

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

B40 will require extra 3 mln heaps feedstock, GAPKI says

Malaysia palm oil benchmark at greatest considering that mid-2022

India might withdraw import tax hike amid inflation, Mistry states

(Adds analyst comments, updates Malaysia's palm oil standard price)

By Bernadette Christina

NUSA DUA, Indonesia, Nov 8 (Reuters) - Indonesia's palm oil output is anticipated to recuperate in 2025 after an expected drop this year, but costs are expected to stay raised due to scheduled growth of the nation's biodiesel required, market analysts said.

The palm oil standard rate in Malaysia has risen more than 35% this year, raised by slow output and Indonesia's strategy to increase the compulsory domestic biodiesel mix to 40% in January from 35% now in an effort to reduce fuel imports.

Palm oil output next year in top manufacturer Indonesia is expected to recuperate by 1.5 million metric tons compared to an approximated 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 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 elsewhere and of other vegetable oils is seen tightening up.

Palm oil output in neighbouring Malaysia is anticipated to dip a little next year after increasing by an approximated 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 said.

'FRIGHTENING' PRICE SURGE

The price surge in palm oil in the past 7 weeks has been "frightening" for purchasers, 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 extra feedstock of around 3 million lots will be needed for B40 application, deteriorating export supply.

The present palm oil premium has actually already caused palm to 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 estimated.

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 be mindful," said Dorab Mistry, director at Indian consumer goods business Godrej International.

He forecast the Malaysian rate around 5,000 ringgit and above up until June 2025.

Mielke and Mistry urged Indonesia to

think about delaying

B40 implementation on concern about its impact on food customers.

Meanwhile, Mistry expected 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