Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025
JAKARTA, July 24 (Reuters) - Indonesia, the world's most significant palm oil manufacturer, is testing 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 executed, the B40 mandate could increase biodiesel usage 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 might be ended up in December, so that complete execution of B40 might be brought out in 2025," energy ministry senior main Eniya Listiani Dewi said in a statement on Tuesday.
The Indonesian Biofuel Producers Association (APROBI) stated the market had the capability to satisfy B40 need, with installed capacity anticipated to rise to 20 million KL yearly next year from 18 million KL now.
"However we will need more raw products to meet B40 demand," Ernest Gunawan, the secretary general of APROBI told Reuters on Wednesday.
The biodiesel industry would require 13.9 million metric lots of crude palm oil to produce 16 million KL biodiesel next year, from the approximated 11 million heaps required this year, he added.
Indonesia's biggest palm oil association GAPKI said a decline in exports indicated there would be adequate raw products to supply the B40 required in the meantime.
But the market would require to assess "which one would be better", GAPKI chairman Eddy Martono stated, referring to the possibility an increase in exports would make supplying the domestic market less viable.
Indonesia's palm oil output is estimated to reach 54.4 million tons in 2024, a 2.26% increase from in 2015, while exports are anticipated to decrease by 2.47% to 29.5 million lots as domestic intake increased, driven by biodiesel required.
The ministry had evaluated the biodiesel, blended with 40% of palm oil, on a train for the very first time previously this week, while planning to check the B40 mix on agriculture equipment, power plants and in the shipping industry, it stated. (Reporting by and Dewi Kurniawati; Writing by Stanley Widianto; Editing by John Mair, Savio D'Souza and Barbara Lewis)