Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025

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JAKARTA, July 24 (Reuters) - Indonesia, the world's most significant palm oil producer, is evaluating fuel with a view to increasing to 40% from 35% the share of palm-oil blended into biodiesel next.

JAKARTA, July 24 (Reuters) - Indonesia, the world's greatest palm oil manufacturer, 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 carried out, the B40 required could increase biodiesel consumption to as much as 16 million kilolitres (KL) next year, the ministry said, 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 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 capability to fulfill B40 demand, with set up capability anticipated to rise to 20 million KL yearly next year from 18 million KL now.


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


The biodiesel industry would require 13.9 million metric loads of unrefined palm oil to produce 16 million KL biodiesel next year, from the estimated 11 million loads needed this year, he included.


Indonesia's most significant palm oil association GAPKI said a decline in exports suggested there would suffice raw materials to supply the B40 mandate in the meantime.


But the market would require to evaluate "which one would be more important", GAPKI chairman Eddy Martono said, referring to the possibility an increase in exports would make supplying the domestic market less practical.


Indonesia's palm oil output is approximated to reach 54.4 million loads in 2024, a 2.26% boost from in 2015, while exports are anticipated to decrease by 2.47% to 29.5 million lots as domestic intake increased, driven by biodiesel mandate.


The ministry had tested the biodiesel, mixed with 40% of palm oil, on a train for the very first time previously today, while planning to evaluate the B40 mix on agriculture 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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