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 mixed into biodiesel next year, the.

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 said.


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


"We hope the trials might be ended up in December, so that full application 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 capability to satisfy B40 demand, with set up capacity anticipated to rise to 20 million KL each year next year from 18 million KL now.


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


The biodiesel market would require 13.9 million metric loads of crude palm oil to produce 16 million KL biodiesel next year, from the approximated 11 million lots required this year, he added.


Indonesia's biggest palm oil association GAPKI said a decrease in exports implied there would be adequate raw products to supply the B40 mandate in the meantime.


But the market would need to assess "which one would be more valuable", GAPKI chairman Eddy Martono stated, referring to the possibility an increase in exports would make supplying the domestic market less feasible.


Indonesia's palm oil output is approximated to reach 54.4 million heaps in 2024, a 2.26% boost from in 2015, while exports are expected to decline by 2.47% to 29.5 million tons as domestic usage rose, driven by biodiesel mandate.


The ministry had evaluated the biodiesel, blended with 40% of palm oil, on a train for the very first time earlier this week, while preparing to evaluate the B40 mix on farming equipment, power plants and in the shipping market, 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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