Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025

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

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

« We hope the trials could be finished in December, so that full application of B40 could be carried out in 2025, » energy ministry senior main Eniya Listiani Dewi said in a statement on Tuesday.

The Indonesian Biofuel Producers Association (APROBI) stated the market had the capacity to fulfill B40 need, with installed capability expected to rise to 20 million KL yearly next year from 18 million KL now.

« However we will require more basic materials to fulfill B40 demand, » Ernest Gunawan, the secretary general of APROBI informed Reuters on Wednesday.

The biodiesel market would require 13.9 million metric heaps of crude palm oil to produce 16 million next year, from the approximated 11 million heaps needed this year, he included.

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

But the industry would need to examine « which one would be more important », GAPKI chairman Eddy Martono stated, referring to the possibility a boost in exports would make providing the domestic market less feasible.

Indonesia’s palm oil output is estimated to reach 54.4 million heaps in 2024, a 2.26% increase from last year, while exports are anticipated to decline by 2.47% to 29.5 million tons as domestic intake increased, driven by biodiesel mandate.

The ministry had actually tested the biodiesel, combined with 40% of palm oil, on a train for the very first time previously today, while planning to evaluate the B40 mix on agriculture equipment, power plants and in the shipping market, it stated. (Reporting by Bernadette Christina and Dewi Kurniawati; Writing by Stanley Widianto; Editing by John Mair, Savio D’Souza and Barbara Lewis)