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 blended into biodiesel next year, the energy ministry stated.
If implemented, the B40 required might increase biodiesel consumption 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 finished in December, so that complete execution of B40 could be carried out in 2025," energy ministry senior official Eniya Listiani Dewi said in a statement on Tuesday.
The Indonesian Biofuel Producers Association (APROBI) stated the industry had the capacity to satisfy B40 need, with installed capacity expected to increase to 20 million KL annually next year from 18 million KL now.
"However we will need more basic materials to meet B40 demand," Ernest Gunawan, the secretary general of APROBI told Reuters on Wednesday.
The biodiesel industry would require 13.9 million metric loads of crude palm oil to produce 16 million KL biodiesel next year, from the approximated 11 million loads needed this year, he added.
Indonesia's greatest palm oil association GAPKI said a decline in exports meant there would be enough raw products to supply the B40 required in the meantime.
But the industry 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 supplying the domestic market less viable.
Indonesia's palm oil output is approximated to reach 54.4 million heaps in 2024, a 2.26% increase from last year, while exports are expected to decrease by 2.47% to 29.5 million tons as domestic usage increased, driven by biodiesel required.
The ministry had evaluated the biodiesel, mixed with 40% of palm oil, on a train for the very first time earlier today, while preparing to evaluate the B40 mix on farming machinery, power plants and in the shipping industry, it stated. (Reporting by Bernadette Christina and Dewi Kurniawati; Writing by Stanley Widianto; Editing by John Mair, Savio D'Souza and Barbara Lewis)
