JAKARTA, July 24 (Reuters) - Indonesia, the world's most significant palm oil producer, is testing 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 might increase biodiesel usage to approximately 16 million kilolitres (KL) next year, the ministry stated, from 13 million KL estimated to be consumed in 2024.
"We hope the trials could be finished in December, so that full execution of B40 could be brought out in 2025," energy ministry senior main Eniya Listiani Dewi said in a declaration on Tuesday.
The Indonesian Biofuel Producers Association (APROBI) said the market had the capability to fulfill B40 need, with installed capacity expected to increase to 20 million KL annually next year from 18 million KL now.
"However we will require more basic materials to fulfill B40 demand," Ernest Gunawan, the secretary general of APROBI told Reuters on Wednesday.
The biodiesel market would require 13.9 million metric lots of crude palm oil to produce 16 million KL biodiesel next year, from the estimated 11 million tons needed this year, he added.
Indonesia's greatest palm oil association GAPKI said a decrease in exports meant there would suffice basic materials to supply the B40 mandate for now.
But the market would require to evaluate "which one would be better", GAPKI chairman Eddy Martono stated, referring to the possibility a boost in exports would make supplying the domestic market less feasible.
Indonesia's palm oil output is estimated to reach 54.4 million loads in 2024, a 2.26% boost from in 2015, while exports are anticipated to decline by 2.47% to 29.5 million heaps as domestic intake rose, driven by biodiesel required.
The ministry had actually evaluated the biodiesel, mixed with 40% of palm oil, on a train for the very first time earlier this week, while preparing to check the B40 mix on agriculture equipment, power plants and in the shipping market, it said. (Reporting by Bernadette Christina and Dewi Kurniawati; Writing by Stanley Widianto; Editing by John Mair, Savio D'Souza and Barbara Lewis)
