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Indonesia confirms the B40 biodiesel Plan to be implemented in January 2025

November 13, 2024

As part of its "quick win" programs, the Indonesian government confirmed to lawmakers that it will implement a mandatory 40% biodiesel blend with palm oil based fuel in January 2025.

The plan was presented by Energy Minister Bahlil lahadalia who told a hearing in parliament that the government expected to implement a mandate B50 by 2026.

Analysts have predicted that the plan to increase biodiesel from its current 35% blend is part of a reduction in fuel imports. This, they say, will increase palm oil demand and prices.

Malaysian palm futures have risen by about 35% in the past year. Thomas Mielke of Hamburg-based Oil World estimated that the introduction of B40 will push prices up by another 10%-15% at an industry conference held last week.

The Minister's presentation of the timeline for introducing B50 was ambitious compared to a statement made by a senior government official last week at the Indonesia Palm Oil Conference, who stated that the government would consider increasing the B50 mix in 2028. (Reporting and Writing by Ananda Terresia, Editing by Martin Petty & John Mair).

(source: Reuters)