Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025

JAKARTA, July 24 (Reuters) – Indonesia, the world’s greatest palm oil producer, is testing 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 carried out, the B40 required might increase biodiesel consumption to up to 16 million kilolitres (KL) next year, the ministry said, from 13 million KL approximated to be consumed in 2024.

“We hope the trials might be completed in December, so that complete implementation of B40 could be performed in 2025,” energy ministry senior main Eniya Listiani Dewi said in a declaration on Tuesday.

The Indonesian Biofuel Producers Association (APROBI) said the market had the capacity to satisfy B40 demand, with installed capability expected to increase to 20 million KL annually next year from 18 million KL now.

“However we will require more basic materials to fulfill B40 need,” Ernest Gunawan, the secretary general of APROBI told Reuters on Wednesday.

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

Indonesia’s most significant palm oil said a decrease in exports indicated there would suffice raw products to supply the B40 mandate in the meantime.

But the industry would need to evaluate “which one would be more important”, GAPKI chairman Eddy Martono said, referring to the possibility a boost in exports would make providing the domestic market less feasible.

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

The ministry had actually tested the biodiesel, blended with 40% of palm oil, on a train for the very first time earlier 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)