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Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025

JAKARTA, July 24 (Reuters) – Indonesia, the world’s greatest palm oil manufacturer, 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 implemented, the B40 required could 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 completed in December, so that complete application of B40 might be performed in 2025,” energy ministry senior official Eniya Listiani Dewi stated in a statement on Tuesday.

The Indonesian Biofuel Producers Association (APROBI) stated the industry had the capacity to meet B40 need, with set up to increase to 20 million KL each year next year from 18 million KL now.

“However we will require more raw products to fulfill B40 need,” Ernest Gunawan, the secretary general of APROBI informed 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 estimated 11 million loads needed this year, he included.

Indonesia’s most significant palm oil association GAPKI said a decrease in exports suggested there would suffice raw materials to supply the B40 mandate for now.

But the market would need to evaluate “which one would be more important”, GAPKI chairman Eddy Martono stated, referring to the possibility a boost in exports would make providing the domestic market less practical.

Indonesia’s palm oil output is approximated 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 heaps as domestic consumption increased, driven by biodiesel required.

The ministry had actually evaluated the biodiesel, combined with 40% of palm oil, on a train for the very first time previously this week, while planning to check the B40 mix on agriculture 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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