Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025
JAKARTA, July 24 (Reuters) - Indonesia, the world's greatest 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 stated.
If executed, the B40 required could increase biodiesel usage to approximately 16 million kilolitres (KL) next year, the ministry stated, from 13 million KL approximated to be consumed in 2024.
"We hope the trials could be finished in December, so that complete execution of B40 could 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 capacity 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 basic materials to fulfill B40 demand," Ernest Gunawan, the secretary general of APROBI informed Reuters on Wednesday.
The biodiesel market would need 13.9 million metric lots of crude palm oil to produce 16 million KL biodiesel next year, from the estimated 11 million heaps needed this year, he added.
Indonesia's biggest palm GAPKI said a decrease in exports indicated there would suffice raw products to supply the B40 mandate in the meantime.
But the market would require to evaluate "which one would be more valuable", GAPKI chairman Eddy Martono said, describing the possibility a boost in exports would make providing the domestic market less feasible.
Indonesia's palm oil output is approximated to reach 54.4 million tons in 2024, a 2.26% increase from last year, while exports are anticipated to decrease by 2.47% to 29.5 million heaps as domestic intake increased, driven by biodiesel mandate.
The ministry had checked 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 farming machinery, 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)