Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025
JAKARTA, July 24 (Reuters) - Indonesia, the world's most significant palm oil producer, is testing fuel with a view to increasing to 40% from 35% the share of palm-oil blended into biodiesel next year, the energy ministry stated.
If out, the B40 required might increase biodiesel usage to approximately 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 finished in December, so that complete implementation of B40 might be carried out in 2025," energy ministry senior main Eniya Listiani Dewi stated in a statement on Tuesday.
The Indonesian Biofuel Producers Association (APROBI) stated the market had the capacity to fulfill B40 demand, with installed capability expected to increase to 20 million KL every year 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 market would require 13.9 million metric lots of unrefined palm oil to produce 16 million KL biodiesel next year, from the approximated 11 million lots required this year, he included.
Indonesia's most significant palm oil association GAPKI stated a decrease in exports indicated there would be adequate raw products to provide the B40 mandate in the meantime.
But the industry would require to assess "which one would be more valuable", GAPKI chairman Eddy Martono said, referring to the possibility an increase in exports would make supplying the domestic market less viable.
Indonesia's palm oil output is approximated to reach 54.4 million heaps in 2024, a 2.26% increase from last year, while exports are expected to decline by 2.47% to 29.5 million loads as domestic consumption increased, driven by biodiesel required.
The ministry had tested the biodiesel, blended with 40% of palm oil, on a train for the very first time earlier today, while planning to check the B40 mix on agriculture equipment, power plants and in the shipping industry, it said. (Reporting by Bernadette Christina and Dewi Kurniawati; Writing by Stanley Widianto; Editing by John Mair, Savio D'Souza and Barbara Lewis)