Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025

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

If carried out, the B40 required could increase biodiesel intake 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 completed in December, so that complete execution of B40 could be performed in 2025,“ energy ministry senior official Eniya Listiani Dewi said in a statement on Tuesday.

The Indonesian Biofuel Producers Association (APROBI) said the industry had the capacity to satisfy B40 need, with installed capacity expected to rise to 20 million KL yearly next year from 18 million KL now.

„However we will require more raw materials to fulfill 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 loads required this year, he included.

Indonesia’s most significant palm oil association GAPKI said a decline in exports meant there would be adequate basic materials to supply the B40 mandate for now.

But the market would require to assess „which one would be more valuable“, GAPKI chairman Eddy Martono stated, referring to the possibility a boost in exports would make supplying the domestic market less practical.

Indonesia’s palm oil output is approximated to reach 54.4 million heaps in 2024, a 2.26% boost from last year, while exports are anticipated to decrease by 2.47% to 29.5 million heaps as domestic consumption rose, driven by biodiesel required.

The ministry had checked 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 machinery, power plants and in the shipping industry, it stated. (Reporting by Bernadette Christina and Dewi Kurniawati; Writing by Stanley Widianto; Editing by John Mair, Savio D’Souza and Barbara Lewis)