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1 Indonesia Plans Increase in Palm Oil based Biodiesel In 2025

JAKARTA, July 24 (Reuters) - Indonesia, the world's biggest palm oil manufacturer, is evaluating fuel with a view to increasing to 40% from 35% the share of palm-oil mixed into biodiesel next year, the energy ministry said.

If implemented, the B40 required could increase biodiesel intake to up to 16 million kilolitres (KL) next year, the ministry said, from 13 million KL approximated to be consumed in 2024.

"We hope the trials could be ended up in December, so that full application of B40 could be brought out in 2025," energy ministry senior official Eniya Listiani Dewi stated in a declaration on Tuesday.

The Indonesian Biofuel Producers Association (APROBI) stated the market had the capacity to satisfy B40 need, with set up capability expected to increase to 20 million KL yearly next year from 18 million KL now.

"However we will require more basic materials to satisfy B40 need," Ernest Gunawan, the secretary general of APROBI told Reuters on Wednesday.

The biodiesel market would require 13.9 million metric lots of unrefined palm oil to produce 16 million KL biodiesel next year, from the approximated 11 million loads needed this year, he added.

Indonesia's biggest palm oil association GAPKI said a decrease in exports implied there would suffice raw materials to provide the B40 mandate in the meantime.

But the market would require to examine "which one would be better", GAPKI chairman Eddy Martono stated, describing the a boost in exports would make supplying the domestic market less feasible.

Indonesia's palm oil output is estimated to reach 54.4 million tons in 2024, a 2.26% boost from last year, while exports are expected to decrease by 2.47% to 29.5 million heaps as domestic consumption rose, driven by biodiesel mandate.

The ministry had tested the biodiesel, blended with 40% of palm oil, on a train for the very first time earlier this week, while planning to test the B40 mix on farming machinery, power plants and in the shipping industry, it stated. (Reporting by Bernadette Christina and Dewi Kurniawati