JAKARTA, July 24 (Reuters) - Indonesia, the world's greatest palm oil manufacturer, is checking fuel with a view to increasing to 40% from 35% the share of palm-oil combined into biodiesel next year, the energy ministry said.
If carried out, the B40 mandate might increase biodiesel consumption to up to 16 million kilolitres (KL) next year, the ministry stated, from 13 million KL estimated to be consumed in 2024.
"We hope the trials might be finished in December, so that full implementation of B40 could be brought 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 meet B40 demand, with set up capability expected to rise to 20 million KL yearly next year from 18 million KL now.
"However we will need more raw products to meet B40 demand," Ernest Gunawan, the secretary general of APROBI told Reuters on Wednesday.
The biodiesel market would need 13.9 million metric heaps of unrefined palm oil to produce 16 million KL biodiesel next year, from the approximated 11 million lots needed this year, he included.
Indonesia's biggest palm oil association GAPKI stated a decrease in exports meant there would be sufficient raw materials to supply the B40 required for now.
But the market would need to assess "which one would be more valuable", GAPKI chairman Eddy Martono said, referring to the possibility a boost in exports would make providing the domestic market less feasible.
Indonesia's palm oil output is estimated to reach 54.4 million loads in 2024, a 2.26% boost from in 2015, while exports are expected to decrease by 2.47% to 29.5 million lots as domestic usage increased, driven by biodiesel required.
The ministry had actually checked the biodiesel, blended with 40% of palm oil, on a train for the very first time previously today, while planning 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)
