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Indonesia plans to increase its mandatory blend of palm oil-based biodiesel to 40% in the coming years, but for now will keep it unchanged at 35%, the country's energy minister said on Monday.
The world's largest palm oil producer raised the mandatory blend from 30% to 35% in February, but the measure has not been fully implemented in some areas.
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“At the moment, we stay with the B35 and then we prepare for the B40. When we feel (it is) ready, we will launch it,” Indonesian Energy Minister Arifin Tasrif told Reuters in an interview on the sidelines of the Energy Asia conference on Monday.
Arifin said Indonesia wants to maximize the use of domestic resources and reduce dependence on crude oil, and that authorities have completed research and road tests for the B40.
Eddy Abdurrachman, CEO of Indonesia's CPO funding agency, which is responsible for providing biodiesel subsidies, said the B35 mandate had not been fully implemented as there were problems with some blending facilities that needed to be upgraded.
The ministry is pushing for the B35 mandate to be fully implemented by August 1.
Energy Ministry official Edi Wibowo said biodiesel consumption as of June 25 was 5.2 million kiloliters, out of the 13.15 million kiloliters allocated for this year.
Indonesia's biodiesel policy and the likely emergence of the El Niño weather pattern could further pressure global stocks of the most-used cooking oil, pushing up palm oil prices this year, according to top industry officials and analysts.
Source: Emily Chow and Bernadette Christina | Notícias Agrícolas
