Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025
JAKARTA, July 24 (Reuters) - Indonesia, the world's most significant palm oil manufacturer, is checking fuel with a view to increasing to 40% from 35% the share of palm-oil mixed into biodiesel next year, the energy ministry said.
If carried out, the B40 mandate could increase biodiesel consumption 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 might be completed in December, so that full implementation of B40 might be performed in 2025," energy ministry senior main Eniya Listiani Dewi stated in a declaration on Tuesday.
The Indonesian Biofuel Producers Association (APROBI) said the industry had the capability to fulfill B40 demand, with set up capacity anticipated to rise to 20 million KL annually next year from 18 million KL now.
"However we will require more raw products to meet B40 need," 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 estimated 11 million loads required this year, he included.
Indonesia's most significant palm oil association GAPKI said a decrease in exports meant there would be sufficient raw products to supply the B40 required in the meantime.
But the industry would require to examine "which one would be better", GAPKI chairman Eddy Martono said, describing the possibility an increase in exports would make supplying the domestic market less practical.
Indonesia's palm oil output is to reach 54.4 million heaps in 2024, a 2.26% increase from last year, while exports are expected to decline by 2.47% to 29.5 million heaps as domestic consumption rose, driven by biodiesel mandate.
The ministry had tested the biodiesel, combined with 40% of palm oil, on a train for the very first time earlier today, while preparing to evaluate the B40 mix on farming equipment, 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)