Malaysia has no plans to increase biodiesel blending Palm oil from the current 10% to 20% as developing the necessary infrastructure would require funding that neither the industry nor the government are willing to provide, the commodities minister said on Monday.
There are challenges to implementing the 20% biodiesel blending as it will require an estimated infrastructure investment of about 643 million ringgit (US$ 146.20 million), Plantations and Commodities Minister Johari Abdul Ghani told parliament.
Malaysia currently imposes a 10% biodiesel mandate. However, in some regions, the requirement is higher. A 20% biodiesel mandate is already in place in Labuan and Langkawi. The same percentage also applies to the state of Sarawak, with the exception of Bintulu, he said.
“Our engagement with industry stakeholders shows they want the government to fund this, but we are not ready for that,” he said.
The largest palm oil producer, Indonesia, has launched a mandatory B40 biodiesel program. This has created a supply shortage on the world market. As a result, palm oil has become more expensive than competing oils.
($1 = 4.3980 ringgit)
Source: Ashley Tang, Rajendra Jadhav and Sherry Jacob-Phillips | Notícias Agrícolas
