Agro Diesel (India) Private Ltd

Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025

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 executed, the B40 mandate might increase biodiesel consumption 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 ended up in December, so that complete application of B40 could be carried out in 2025,” energy ministry senior official Eniya Listiani Dewi said in a statement on Tuesday.

The Indonesian Biofuel Producers Association (APROBI) said the market had the capacity to meet B40 demand, with installed capacity anticipated to increase to 20 million KL every year 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 industry would need 13.9 million metric heaps of crude palm oil to produce 16 million KL biodiesel next year, from the approximated 11 million loads required this year, he included.

Indonesia’s greatest palm oil said a decline in exports indicated there would be adequate raw products to provide the B40 required in the meantime.

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

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

The ministry had evaluated the biodiesel, combined with 40% of palm oil, on a train for the very first time previously this week, while planning to evaluate the B40 mix on agriculture 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)