Biodiesel allowance decree was waited for by market
Indonesia had actually prepared to release higher biodiesel mix on Jan. 1
Palm oil criteria contract increased 1% after previous fall
Government goes 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 allocating 15.6 million kilolitres (KL) of biodiesel for 2025 circulation, while offering the industry up until the end of next month to adjust to the higher level of the fuel in the mix.
Indonesia, the world's largest exporter of palm oil, had actually prepared to introduce the obligatory 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 press reporters, including the federal government was working to increase the necessary biodiesel mix to 50% next year.
Eniya Listiani Dewi, a ministry senior official, said biodiesel manufacturers and fuel merchants will be given up until Feb. 28 to adjust to the B40 mix. She stated the hold-up was due to the fact that of technical obstacles linked to subsidies for the fuel.
The non-implementation on Jan. 1. had actually led to 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 said they were not able to prepare contracts for biodiesel circulation without the decree.
The biodiesel allowance for 2025 indicated an increase from 2024's approximated biodiesel consumption of 12.98 KL, ministry information revealed on Friday.
Of the total allotment for this year, 7.55 million KL is for the general public service responsibility (PSO), which covers sectors such as mass transit, whose sales will be subsidised by the nation's palm oil fund.
"The remaining allotments will be cost market value. The non-PSO allocation is set at 8.07 million KL," Bahlil said, including the fund might not subsidise the rate space in between the palm oil and nonrenewable fuel sources for the general allocation.
BPDPKS, the agency in charge of collecting and managing the palm oil funds, in November B40 would need a 68% subsidy increase.
To assist finance that, Indonesia plans to increase its export levy for crude palm oil (CPO) to 10% from the current 7.5%, however for that to happen, another official policy 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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