Indonesia Signs 15.6 Mln Kilolitres Biodiesel Allocation For 2025
Biodiesel allocation decree was waited for by market
had actually planned to release greater biodiesel mix on Jan. 1
Palm oil benchmark agreement rose 1% after previous fall
Government goes 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 designating 15.6 million kilolitres (KL) of biodiesel for 2025 circulation, while offering the industry up until completion of next month to adapt to the greater level of the fuel in the mix.
Indonesia, the world's biggest exporter of palm oil, had prepared to release the obligatory requirement of 40% palm oil fuel in biodiesel on Jan. 1, up from 35% now.
"The ministerial guideline has been signed," the minister Bahlil Lahadalia informed press reporters, including the federal government was working to increase the compulsory biodiesel mix to 50% next year.
Eniya Listiani Dewi, a ministry senior official, stated biodiesel producers and fuel sellers will be given until Feb. 28 to adjust to the B40 mix. She said the hold-up was because of technical obstacles connected to aids for the fuel.
The non-implementation on Jan. 1. had actually resulted in a 2.6% drop in the Malaysian palm oil criteria contract on Thursday. On Friday, it recuperated by around 1%.
Fuel retailers and biodiesel producers had actually stated they were unable to prepare agreements for biodiesel circulation without the decree.
The biodiesel allocation for 2025 suggested an increase from 2024's approximated biodiesel consumption of 12.98 KL, ministry information showed on Friday.
Of the total allowance for this year, 7.55 million KL is for the public service obligation (PSO), which covers sectors such as public transport, whose sales will be subsidised by the nation's palm oil fund.
"The staying allocations will be cost market cost. The non-PSO allotment is set at 8.07 million KL," Bahlil said, adding the fund might not subsidise the rate gap in between the palm oil and fossil fuels for the general allocation.
BPDPKS, the firm in charge of collecting and managing the palm oil funds, approximated in November B40 would require a 68% aid boost.
To assist finance that, Indonesia prepares to increase its export levy for unrefined palm oil (CPO) to 10% from the existing 7.5%, but for that to occur, another main regulation is needed. (Reporting by Bernadette Christina Munthe, Fransiska Nangoy, Dewi Kurniawati; editing by John Mair, Savio D'Souza, Shri Navaratnam and Barbara Lewis)