Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025
JAKARTA, July 24 (Reuters) - Indonesia, the world's greatest palm oil producer, is checking 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 executed, the B40 required might increase biodiesel consumption 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 could be ended up in December, so that complete implementation of B40 could be performed in 2025," energy ministry senior main Eniya Listiani Dewi said in a statement on Tuesday.
The Indonesian Biofuel Producers Association (APROBI) stated the industry had the capability to satisfy B40 demand, with installed capacity anticipated to rise to 20 million KL each year next year from 18 million KL now.
"However we will require more raw materials to fulfill B40 need," Ernest Gunawan, the secretary general of APROBI told 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 required this year, he included.
Indonesia's greatest palm oil association GAPKI said a decrease in exports suggested there would be enough basic materials to provide the B40 required in the meantime.
But the industry would need to assess "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 estimated to reach 54.4 million loads in 2024, a 2.26% increase from last year, while exports are expected to decline by 2.47% to 29.5 million lots 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 first time previously today, while preparing to evaluate the B40 mix on equipment, power plants and in the shipping market, it stated. (Reporting by Bernadette Christina and Dewi Kurniawati; Writing by Stanley Widianto; Editing by John Mair, Savio D'Souza and Barbara Lewis)