Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025

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JAKARTA, July 24 (Reuters) - Indonesia, the world's biggest palm oil manufacturer, is checking fuel with a view to increasing to 40% from 35% the share of palm-oil combined into biodiesel next year,.

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


If implemented, the B40 required might increase biodiesel intake to up to 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 ended up in December, so that full execution of B40 might be performed in 2025," energy ministry senior official Eniya Listiani Dewi stated in a declaration on Tuesday.


The Indonesian Biofuel Producers Association (APROBI) stated the industry had the capability to satisfy B40 demand, with set up 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 demand," Ernest Gunawan, the secretary general of APROBI informed Reuters on Wednesday.


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


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


But the industry would require to evaluate "which one would be better", GAPKI chairman Eddy Martono said, referring to the possibility a boost in exports would make supplying the domestic market less practical.


Indonesia's palm oil output is estimated to reach 54.4 million loads in 2024, a 2.26% boost from in 2015, while exports are expected to decrease by 2.47% to 29.5 million loads as domestic consumption increased, driven by biodiesel required.


The ministry had actually tested the biodiesel, blended with 40% of palm oil, on a train for the first time earlier this week, while planning to evaluate the B40 mix on agriculture machinery, 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)

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