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1 Indonesia Plans Increase in Palm Oil based Biodiesel In 2025

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

If carried out, the B40 mandate could increase biodiesel usage to approximately 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 finished in December, so that full implementation of B40 could be carried out 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 capability to fulfill B40 need, with set up capability expected to increase to 20 million KL yearly 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 lots of unrefined palm oil to produce 16 million KL biodiesel next year, from the approximated 11 million lots required this year, he added.

Indonesia's most significant palm oil association GAPKI said a decline in exports indicated there would suffice basic materials to provide the B40 mandate in the meantime.

But the market would need to examine "which one would be more valuable", GAPKI chairman Eddy Martono said, referring to the possibility an increase in exports would make supplying the domestic market less feasible.

Indonesia's palm oil output is approximated to reach 54.4 million tons in 2024, a 2.26% increase from last year, while exports are anticipated to decline by 2.47% to 29.5 million lots as rose, driven by biodiesel required.

The ministry had checked the biodiesel, combined with 40% of palm oil, on a train for the very first time earlier today, while preparing to test the B40 mix on farming equipment, power plants and in the shipping market, it stated. (Reporting by Bernadette Christina and Dewi Kurniawati