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Mission Biofuels Sdn. Bhd

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  • Founded Date March 5, 1901
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Indonesia Signs 15.6 Mln Kilolitres Biodiesel Allocation For 2025

Biodiesel allotment decree was waited for by industry

Indonesia had actually planned to release higher biodiesel mix on Jan. 1

Palm oil criteria agreement rose 1% after previous fall

Government aims for 50% biodiesel mix in 2026

(Recasts with energy minister’s remark)

By Bernadette Christina and Fransiska Nangoy

JAKARTA, Jan 3 (Reuters) – Indonesia Energy and Mineral Resources Minister signed a decree on Friday allocating 15.6 million kilolitres (KL) of biodiesel for 2025 distribution, while giving the market up until completion of next month to adapt to the higher level of the fuel in the mix.

Indonesia, the world’s largest exporter of palm oil, had to release the necessary requirement of 40% palm oil fuel in biodiesel on Jan. 1, up from 35% now.

“The ministerial policy has actually been signed,” the minister Bahlil Lahadalia informed reporters, adding the government was working to increase the mandatory biodiesel mix to 50% next year.

Eniya Listiani Dewi, a ministry senior authorities, stated biodiesel manufacturers and fuel sellers will be provided till Feb. 28 to adjust to the B40 mix. She stated the hold-up was since of technical obstacles connected to subsidies for the fuel.

The non-implementation on Jan. 1. had led to a 2.6% drop in the Malaysian palm oil standard contract on Thursday. On Friday, it recuperated by around 1%.

Fuel retailers and biodiesel producers had actually stated they were unable to draw up contracts for biodiesel circulation without the decree.

The biodiesel allowance for 2025 suggested a boost from 2024‘s approximated biodiesel usage of 12.98 KL, ministry data showed on Friday.

Of the total allowance for this year, 7.55 million KL is for the public service commitment (PSO), which covers sectors such as public transportation, whose sales will be subsidised by the country’s palm oil fund.

“The remaining allotments will be cost market rate. The non-PSO allotment is set at 8.07 million KL,” Bahlil said, adding the fund might not subsidise the price space in between the palm oil and fossil fuels for the general allotment.

BPDPKS, the firm in charge of gathering and managing the palm oil funds, estimated in November B40 would require a 68% aid boost.

To help fund that, Indonesia plans to increase its export levy for unrefined palm oil (CPO) to 10% from the current 7.5%, however for that to occur, another main policy is needed. (Reporting by Bernadette Christina Munthe, Fransiska Nangoy, Dewi Kurniawati; modifying by John Mair, Savio D’Souza, Shri Navaratnam and Barbara Lewis)