Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025

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

If implemented, the B40 required could increase biodiesel consumption to as much as 16 million kilolitres (KL) next year, the ministry said, from 13 million KL estimated to be consumed in 2024.

“We hope the trials could be ended up in December, so that full execution of B40 might be brought out in 2025,” energy ministry senior official Eniya Listiani Dewi stated in a statement on Tuesday.

The Indonesian Biofuel Producers Association (APROBI) stated the market had the capacity to fulfill B40 demand, with set up capability expected to increase to 20 million KL every year next year from 18 million KL now.

“However we will require more raw products to satisfy B40 need,” Ernest Gunawan, the secretary general of APROBI informed Reuters on Wednesday.

The biodiesel industry would require 13.9 million metric loads of crude palm oil to produce 16 million KL biodiesel next year, from the approximated 11 million lots needed this year, he added.

Indonesia’s biggest palm oil association GAPKI stated a decline in exports implied there would suffice raw materials to supply the B40 mandate for now.

But the industry would need to examine “which one would be more valuable”, GAPKI chairman Eddy Martono said, referring to the possibility an increase in exports would make providing the domestic market less practical.

Indonesia’s palm oil output is estimated to reach 54.4 million tons in 2024, a 2.26% increase from in 2015, while exports are anticipated to decrease by 2.47% to 29.5 million heaps as domestic usage increased, driven by biodiesel mandate.

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