Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025

JAKARTA, July 24 (Reuters) – Indonesia, the greatest palm oil manufacturer, 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 said.

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

“We hope the trials could be ended up in December, so that complete application of B40 could be performed in 2025,” energy ministry senior main Eniya Listiani Dewi stated in a declaration on Tuesday.

The Indonesian Biofuel Producers Association (APROBI) stated the market had the capability to satisfy B40 need, with installed capability expected to rise to 20 million KL every year next year from 18 million KL now.

“However we will require more basic materials to satisfy B40 demand,” Ernest Gunawan, the secretary general of APROBI informed Reuters on Wednesday.

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

Indonesia’s greatest palm oil association GAPKI stated a decrease in exports implied there would be adequate basic materials to provide the B40 required for now.

But the market would need to examine “which one would be better”, GAPKI chairman Eddy Martono stated, referring to the possibility a boost in exports would make providing the domestic market less viable.

Indonesia’s palm oil output is estimated to reach 54.4 million tons in 2024, a 2.26% boost from last year, while exports are expected to decrease by 2.47% to 29.5 million loads as domestic consumption increased, driven by biodiesel required.

The ministry had actually evaluated the biodiesel, mixed with 40% of palm oil, on a train for the very first time earlier this week, while planning to evaluate the B40 mix on farming machinery, 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)