Biodiesel allotment decree was waited for by industry
Indonesia had planned to release higher biodiesel mix on Jan. 1
Palm oil criteria contract increased 1% after previous fall
Government goes for 50% biodiesel mix in 2026
(Recasts with energy minister's remark)
By Bernadette Christina and Fransiska Nangoy
JAKARTA, Jan 3 (Reuters) - Indonesia Energy and Mineral Resources Minister signed a decree on Friday allocating 15.6 million kilolitres (KL) of biodiesel for 2025 distribution, while giving the market up until completion of next month to adjust to the higher level of the fuel in the mix.
Indonesia, the world's largest exporter of palm oil, had actually planned to launch the obligatory requirement of 40% palm oil fuel in biodiesel on Jan. 1, up from 35% now.
"The ministerial policy has been signed," the minister Bahlil Lahadalia told reporters, adding the federal government was working to increase the necessary biodiesel mix to 50% next year.
Eniya Listiani Dewi, a ministry senior authorities, said biodiesel producers and fuel merchants will be given till Feb. 28 to adjust to the B40 mix. She said the delay was due to the fact that of technical difficulties linked to aids for the fuel.
The non-implementation on Jan. 1. had caused a 2.6% drop in the Malaysian palm oil standard contract on Thursday. On Friday, it recovered by around 1%.
Fuel sellers and biodiesel manufacturers had said they were not able to draw up contracts for biodiesel circulation without the decree.
The biodiesel allotment for 2025 indicated an increase from 2024's estimated biodiesel consumption of 12.98 KL, ministry data revealed on Friday.
Of the overall allocation for this year, 7.55 million KL is for the public service responsibility (PSO), which covers sectors such as public transport, whose sales will be subsidised by the country's palm oil fund.
"The staying allotments will be sold at market rate. The non-PSO allowance is set at 8.07 million KL," Bahlil said, including the fund might not subsidise the cost gap between the palm oil and nonrenewable fuel sources for the overall allocation.
BPDPKS, the company in charge of collecting and managing the palm oil funds, approximated in November B40 would need a 68% aid boost.
To assist finance that, Indonesia prepares to increase its export levy for crude palm oil (CPO) to 10% from the present 7.5%, but for that to happen, another main is required. (Reporting by Bernadette Christina Munthe, Fransiska Nangoy, Dewi Kurniawati
1
Indonesia Signs 15.6 Mln Kilolitres Biodiesel Allocation For 2025
Ginger Stack edited this page 7 days ago