It depends on too many variables – especially age and capacity to understand and follow instructions.
And of course rotation is just one of a myriad of useful movements.
Incidentally – and I will digress here – Green’s post above throws light on one of the main problems when discussing this sort of subject. I very much understand what she is talking about (even though I may not agree completely) but a student may be totally at sea. She says there are three basic movements: finger, wrist and rotation. But “finger” and “wrist” are not movements, but parts of one’s anatomy. Am I being pedantic? I don’t think so.
A student (and actually most people) will understand instructions literally. I remember a teacher I was observing at a certain point, saying to the student: “Play evenly, play evenly! And the student was clearly trying his best and failing miserably. The teacher looked at me as if to say “I give up!”, at which point I told the student: “play in a way do that it
sounds even”. And the student did a perfect rendition. You see, in order to have an even sound you must
play unevenly (think of scales). The student was following instructions literally, trying to make his movements even, which of course immediately resulted in a highly uneven sound. Words and the way we use them are very important.
But to go back to your question. I teach rotation from the very first, since
everything can and should be played with rotation you certainly don’t have to wait until Liszt,. And by then it may be too late. Again, rotation is just one movement – there are many others (hand shifting and backwards and forwards motion of the arm to accommodate the thumb and little finger are other important ones) – and most important: their co-ordination. Although these movements should be shown and practised in isolation at first, one should integrate and co-ordinate them as soon as possible (that is, immediately after the student understands and can do them).
How to go about it? Several approaches are best than one. You can try:
1. Demonstrating and having the student imitate you – both away from the piano and at the piano.
2. Actually moving the student hand (while he stays relaxed) so s/he feels what it is like).
3. And the most important one: find a situation in the life of the student where s/he uses the motion naturally and transfer the knowledge to piano playing. In the case of forearm rotation, you can ask them: “How do you turn a door handle?” If they go to karate lessons, asked them to show you a karate punch (it involves rotation of the forearm). You get the idea. This is a powerful method because they are not required to learn something new, but rather to apply something they already know to a new situation.
Ultimately, true technique is always easier than what a student might do by himself, so once understood, the new technique should easily replace the old (inappropriate one).

Best wishes,
Bernhard.