Biodiesel allotment decree was awaited by market
Indonesia had planned to launch higher biodiesel mix on Jan. 1
Palm oil standard agreement increased 1% after previous fall
Government intends for 50% biodiesel mix in 2026
(Recasts with energy minister's comment)
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 circulation, while giving the industry up until the end of next month to adjust to the greater level of the fuel in the mix.
Indonesia, the world's biggest exporter of palm oil, had planned to release the mandatory requirement of 40% palm oil fuel in biodiesel on Jan. 1, up from 35% now.
"The ministerial regulation has actually been signed," the minister Bahlil Lahadalia informed press reporters, adding the government was working to increase the obligatory biodiesel mix to 50% next year.
Eniya Listiani Dewi, a ministry senior official, said biodiesel manufacturers and fuel sellers will be given until Feb. 28 to adapt to the B40 mix. She said the delay was since of technical challenges linked to aids for the fuel.
The non-implementation on Jan. 1. had actually led to a 2.6% drop in the Malaysian palm oil benchmark contract on Thursday. On Friday, it recovered by around 1%.
Fuel merchants and biodiesel manufacturers had actually stated they were not able to prepare agreements for biodiesel distribution without the decree.
The biodiesel allowance for 2025 showed a boost from 2024's approximated biodiesel usage of 12.98 KL, ministry data revealed on Friday.
Of the total allowance for this year, 7.55 million KL is for the general public service commitment (PSO), which covers sectors such as mass transit, whose sales will be subsidised by the nation's palm oil fund.
"The staying allowances will be cost market cost. The non-PSO allocation is set at 8.07 million KL," Bahlil stated, including the fund could not subsidise the cost space between the palm oil and nonrenewable fuel sources for the general allocation.
BPDPKS, the agency in charge of collecting and managing the palm oil funds, approximated in November B40 would need a 68% aid boost.
To help finance that, Indonesia plans to increase its export levy for crude palm oil (CPO) to 10% from the existing 7.5%, but for that to take place, another main guideline is needed. (Reporting by Bernadette Christina Munthe, Fransiska Nangoy, Dewi Kurniawati
1
Indonesia Signs 15.6 Mln Kilolitres Biodiesel Allocation For 2025
Kermit Taft edited this page 1 day ago