Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025

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

If executed, the B40 required could increase biodiesel intake to approximately 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 full execution 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 market had the capability to meet B40 need, with installed capability expected to increase to 20 million KL yearly next year from 18 million KL now.

“However we will require more basic materials to meet B40 demand,” Ernest Gunawan, the secretary general of APROBI told Reuters on Wednesday.

The biodiesel market would need 13.9 million metric tons 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 association GAPKI said a decline in exports implied there would suffice raw products to supply the B40 required for now.

But the industry would require to evaluate “which one would be better”, GAPKI chairman Eddy stated, referring to the possibility a boost in exports would make supplying the domestic market less viable.

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

The ministry had evaluated the biodiesel, combined with 40% of palm oil, on a train for the very first time earlier today, while planning to check 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)