Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025

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

If implemented, the B40 mandate could increase biodiesel consumption to up to 16 million kilolitres (KL) next year, the ministry stated, from 13 million KL estimated to be consumed in 2024.

“We hope the trials might be finished in December, so that complete implementation of B40 might be brought out in 2025,” energy ministry senior main Eniya Listiani Dewi said in a statement on Tuesday.

The Indonesian Biofuel Producers Association (APROBI) said the industry had the capability to fulfill B40 demand, with installed capability anticipated to increase to 20 million KL every year next year from 18 million KL now.

“However we will need more raw 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 crude palm oil to produce 16 million KL biodiesel next year, from the approximated 11 million loads needed this year, he added.

Indonesia’s biggest palm oil association GAPKI said a decline in exports meant there would suffice raw materials to supply the B40 mandate in the meantime.

But the industry would require to evaluate “which one would be better”, GAPKI chairman Eddy Martono stated, referring to the possibility an increase in exports would make providing the domestic market less practical.

Indonesia’s palm oil output is approximated to reach 54.4 million loads in 2024, a 2.26% boost from in 2015, while exports are anticipated to decline by 2.47% to 29.5 million lots as rose, driven by biodiesel required.

The ministry had actually checked the biodiesel, combined with 40% of palm oil, on a train for the very first time previously this week, while planning to test 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)