Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025
JAKARTA, July 24 (Reuters) - Indonesia, the world's greatest palm oil producer, is evaluating fuel with a view to increasing to 40% from 35% the share of palm-oil mixed into biodiesel next year, the energy ministry stated.
If executed, the B40 mandate might increase biodiesel intake to as much as 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 complete application of B40 might be carried out in 2025," energy ministry senior official Eniya Listiani Dewi said in a declaration on Tuesday.
The Indonesian Biofuel Producers Association (APROBI) stated the market had the capability to meet B40 need, with set up capacity anticipated to increase to 20 million KL annually next year from 18 million KL now.
"However we will need more raw materials to meet B40 demand," Ernest Gunawan, the secretary general of APROBI informed 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 estimated 11 million lots required this year, he added.
Indonesia's biggest palm oil association GAPKI said a decrease in there would be adequate basic materials to supply the B40 required in the meantime.
But the market would require to evaluate "which one would be more important", 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 approximated to reach 54.4 million tons in 2024, a 2.26% boost from in 2015, while exports are expected to decrease by 2.47% to 29.5 million tons as domestic intake increased, driven by biodiesel required.
The ministry had checked the biodiesel, mixed with 40% of palm oil, on a train for the very first time previously this week, while planning to evaluate the B40 mix on farming equipment, power plants and in the shipping industry, it stated. (Reporting by Bernadette Christina and Dewi Kurniawati; Writing by Stanley Widianto; Editing by John Mair, Savio D'Souza and Barbara Lewis)