Indonesia Plans Increase In Palm Oil-based Biodiesel In 2025

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


If implemented, the B40 required could increase biodiesel intake to up to 16 million kilolitres (KL) next year, the ministry stated, from 13 million KL estimated to be consumed in 2024.


"We hope the trials could be finished in December, so that complete implementation of B40 could be performed in 2025," energy ministry senior official Eniya Listiani Dewi stated in a statement on Tuesday.


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


"However we will need more basic materials to meet B40 demand," Ernest Gunawan, the secretary general of APROBI informed Reuters on Wednesday.


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


Indonesia's greatest palm oil association GAPKI said a decrease in exports implied there would suffice basic materials to provide the B40 required for now.


But the market would need to assess "which one would be more important", GAPKI chairman Eddy Martono stated, referring to the possibility a boost in exports would make providing the domestic market less feasible.


Indonesia's palm oil output is estimated to reach 54.4 million tons in 2024, a 2.26% boost from in 2015, while exports are anticipated to by 2.47% to 29.5 million lots as domestic consumption increased, driven by biodiesel mandate.


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

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