Indonesia Plans Increase in Palm Oil-based Biodiesel In 2025
JAKARTA, July 24 (Reuters) - Indonesia, the world's most significant palm oil manufacturer, 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 stated.
If executed, the B40 required might increase biodiesel usage to up to 16 million kilolitres (KL) next year, the ministry said, from 13 million KL estimated to be consumed in 2024.
"We hope the trials might be finished in December, so that complete implementation 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) said the market had the capability to fulfill B40 need, with installed capability expected to increase to 20 million KL every year next year from 18 million KL now.
"However we will require more basic materials to satisfy B40 demand," Ernest Gunawan, the secretary general of APROBI told Reuters on Wednesday.
The biodiesel industry would need 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 biggest palm oil association GAPKI stated a decline in exports implied there would suffice raw materials to supply the B40 required in the meantime.
But the market would require to examine "which one would be better", GAPKI chairman Eddy Martono said, referring to the possibility an increase in exports would make providing the domestic market less practical.
Indonesia's palm oil output is estimated to reach 54.4 million loads in 2024, a 2.26% increase from last year, while are expected to decrease by 2.47% to 29.5 million tons as domestic consumption increased, driven by biodiesel required.
The ministry had actually evaluated the biodiesel, blended with 40% of palm oil, on a train for the very first time earlier this week, while preparing 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)