Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025

JAKARTA, July 24 (Reuters) – Indonesia, the world’s most significant palm oil producer, is testing fuel with a view to increasing to 40% from 35% the share of palm-oil blended into biodiesel next year, the energy ministry stated.

If implemented, the B40 mandate might increase biodiesel intake to up to 16 million kilolitres (KL) next year, the ministry said, from 13 million KL approximated to be consumed in 2024.

“We hope the trials might be finished in December, so that full execution of B40 might be performed in 2025,” energy ministry senior main Eniya Listiani Dewi said in a declaration on Tuesday.

The Indonesian Biofuel Producers Association (APROBI) said the market had the capacity to meet B40 need, with set up capability anticipated to rise to 20 million KL annually next year from 18 million KL now.

“However we will require more basic materials to meet B40 need,” Ernest Gunawan, the secretary general of APROBI informed Reuters on Wednesday.

The biodiesel industry would need 13.9 million metric lots of unrefined palm oil to produce 16 million KL biodiesel next year, from the approximated 11 million lots required this year, he added.

Indonesia’s greatest palm oil association GAPKI stated a decrease in exports suggested there would suffice basic materials to supply the B40 mandate for now.

But the industry would need to examine “which one would be better”, GAPKI chairman Eddy Martono said, describing the possibility a boost in exports would make the domestic market less feasible.

Indonesia’s palm oil output is estimated to reach 54.4 million lots in 2024, a 2.26% boost from in 2015, while exports are anticipated to decrease by 2.47% to 29.5 million lots as domestic intake increased, driven by biodiesel required.

The ministry had actually checked the biodiesel, combined with 40% of palm oil, on a train for the first time earlier today, while preparing to check the B40 mix on agriculture machinery, power plants and in the shipping industry, it said. (Reporting by Bernadette Christina and Dewi Kurniawati; Writing by Stanley Widianto; Editing by John Mair, Savio D’Souza and Barbara Lewis)