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 blended into biodiesel next year, the energy ministry stated.


If carried out, the B40 mandate might increase biodiesel usage to up to 16 million kilolitres (KL) next year, the ministry stated, from 13 million KL approximated to be consumed in 2024.


"We hope the trials could be completed in December, so that complete application of B40 could be carried out 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 capability to satisfy B40 demand, with set up capability expected to rise to 20 million KL annually next year from 18 million KL now.


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


The biodiesel market would need 13.9 million metric tons of unrefined palm oil to produce 16 million KL biodiesel next year, from the approximated 11 million lots needed this year, he included.


Indonesia's greatest palm oil association GAPKI said a decline in exports implied there would be adequate raw products to supply the B40 mandate in the meantime.


But the industry would need to examine "which one would be better", GAPKI chairman Eddy Martono said, referring to the possibility a boost in exports would make providing the domestic market less practical.


oil output is approximated to reach 54.4 million loads in 2024, a 2.26% boost from in 2015, while exports are anticipated to decline by 2.47% to 29.5 million lots as domestic consumption rose, driven by biodiesel mandate.


The ministry had checked the biodiesel, combined with 40% of palm oil, on a train for the very first time earlier today, while planning to test the B40 mix on farming machinery, power plants and in the shipping market, it said. (Reporting by Bernadette Christina and Dewi Kurniawati; Writing by Stanley Widianto; Editing by John Mair, Savio D'Souza and Barbara Lewis)