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 stated.

If executed, the B40 mandate could increase biodiesel usage to as much as 16 million kilolitres (KL) next year, the ministry stated, from 13 million KL approximated to be consumed in 2024.

«We hope the trials might be ended up in December, so that complete application of B40 might be performed in 2025,» energy ministry senior official 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 set up capacity anticipated to rise to 20 million KL yearly next year from 18 million KL now.

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

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

Indonesia’s greatest palm oil association GAPKI said a decline in exports implied there would be enough raw materials to provide the B40 required in the meantime.

But the industry would need to assess «which one would be better», GAPKI chairman Eddy Martono stated, describing the possibility a boost in exports would make providing the domestic market less practical.

Indonesia’s palm oil output is to reach 54.4 million tons in 2024, a 2.26% boost from in 2015, while exports are expected to decrease by 2.47% to 29.5 million tons as domestic consumption rose, driven by biodiesel mandate.

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