JAKARTA, July 24 (Reuters) - Indonesia, the world's biggest palm oil producer, is checking 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 executed, the B40 mandate could increase biodiesel consumption 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 might be finished in December, so that complete execution 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) stated the industry had the capacity to meet B40 demand, with installed capability expected to increase to 20 million KL annually next year from 18 million KL now.
"However we will need more basic materials to fulfill B40 need," Ernest Gunawan, the secretary general of APROBI told Reuters on Wednesday.
The biodiesel industry would require 13.9 million metric lots of crude palm oil to produce 16 million KL biodiesel next year, from the approximated 11 million lots needed this year, he added.
Indonesia's biggest palm oil association GAPKI stated a decrease in exports meant there would suffice raw materials to supply the B40 required for now.
But the industry would need to evaluate "which one would be better", GAPKI chairman Eddy Martono stated, 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% boost from last year, while exports are expected to decrease by 2.47% to 29.5 million loads as domestic intake 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 planning to test the B40 mix on farming 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)
