Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025

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

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


If carried out, the B40 required might increase biodiesel intake to as much as 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 application of B40 could be brought out in 2025," energy ministry senior official Eniya Listiani Dewi said in a statement on Tuesday.


The Indonesian Biofuel Producers Association (APROBI) said the industry had the capability to fulfill B40 need, with installed capacity expected to increase to 20 million KL every year next year from 18 million KL now.


"However we will require more raw products to satisfy B40 demand," Ernest Gunawan, the secretary general of APROBI told Reuters on Wednesday.


The biodiesel industry would need 13.9 million metric heaps of unrefined palm oil to produce 16 million KL biodiesel next year, from the approximated 11 million tons needed this year, he included.


Indonesia's greatest palm oil association GAPKI stated a decline in exports suggested there would be enough raw products to provide the B40 mandate in the meantime.


But the market would require to evaluate "which one would be better", GAPKI chairman Eddy Martono said, describing the possibility an increase in exports would make supplying the domestic market less feasible.


Indonesia's palm oil output is estimated to reach 54.4 million heaps in 2024, a 2.26% increase from in 2015, while exports are anticipated to decrease by 2.47% to 29.5 million loads as domestic usage rose, driven by biodiesel required.


The ministry had tested the biodiesel, blended with 40% of palm oil, on a train for the very first time previously this week, while planning to test the B40 mix on farming machinery, power plants and in the shipping market, it said. (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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