Biodiesel allocation decree was awaited by industry
Indonesia had actually planned to launch higher biodiesel mix on Jan. 1
Palm oil standard contract 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 assigning 15.6 million kilolitres (KL) of biodiesel for 2025 distribution, while giving the industry until completion of next month to adapt to the higher level of the fuel in the mix.
Indonesia, the world's biggest exporter of palm oil, had prepared to release the compulsory requirement of 40% palm oil fuel in biodiesel on Jan. 1, up from 35% now.
"The ministerial guideline has actually been signed," the minister Bahlil Lahadalia told reporters, adding the was working to increase the mandatory biodiesel mix to 50% next year.
Eniya Listiani Dewi, a ministry senior official, stated biodiesel producers and fuel retailers will be offered up until Feb. 28 to adjust to the B40 mix. She said the hold-up was since of technical obstacles linked to subsidies for the fuel.
The non-implementation on Jan. 1. had actually caused a 2.6% drop in the Malaysian palm oil criteria agreement on Thursday. On Friday, it recuperated by around 1%.
Fuel merchants and biodiesel producers had actually stated they were not able to draw up contracts for biodiesel distribution without the decree.
The biodiesel allotment for 2025 suggested an increase from 2024's estimated biodiesel consumption of 12.98 KL, ministry information showed on Friday.
Of the total allocation for this year, 7.55 million KL is for the public service responsibility (PSO), which covers sectors such as public transportation, whose sales will be subsidised by the country's palm oil fund.
"The staying allocations will be cost market value. The non-PSO allowance is set at 8.07 million KL," Bahlil said, including the fund might not subsidise the cost gap in between the palm oil and nonrenewable fuel sources for the overall allotment.
BPDPKS, the company in charge of collecting and handling the palm oil funds, approximated in November B40 would require a 68% aid boost.
To help fund that, Indonesia prepares to increase its export levy for unrefined palm oil (CPO) to 10% from the current 7.5%, however for that to take place, another main guideline is required. (Reporting by Bernadette Christina Munthe, Fransiska Nangoy, Dewi Kurniawati
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Indonesia Signs 15.6 Mln Kilolitres Biodiesel Allocation For 2025
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